Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 05, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | NEW YORK MORTGAGE TRUST INC | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 109,569,315 | |
Amendment Flag | false | |
Entity Central Index Key | 1,273,685 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus (i.e. Q1,Q2,Q3,FY) | Q2 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | ||
ASSETS | ||||
Investment securities, available for sale, at fair value (including $42,271 and $40,734 held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively and pledged securities of $700,817 and $639,683, as of June 30, 2016 and December 31, 2015, respectively) | [1] | $ 796,489 | $ 765,454 | |
Multi-family loans held in securitization trusts, at fair value | 7,282,145 | 7,105,336 | ||
Derivative assets | 291,680 | 228,775 | ||
Cash and cash equivalents | 49,941 | 61,959 | ||
Investments in affiliates | 73,839 | 87,662 | ||
Mezzanine loan and preferred equity | 75,300 | 44,151 | ||
Goodwill | 24,782 | 0 | ||
Receivables and other assets | 144,432 | 83,995 | ||
Total Assets | [2] | 9,388,142 | 9,056,242 | |
Liabilities: | ||||
Outstanding Financing Arrangements | 618,050 | 577,413 | [3] | |
Securitized debt | 244,016 | 116,541 | ||
Derivative liabilities | 6,438 | 1,500 | ||
Payable for securities purchased | 286,452 | 227,969 | ||
Accrued expenses and other liabilities | 61,935 | 59,527 | ||
Subordinated debentures | 45,000 | 45,000 | ||
Total liabilities | [2] | 8,521,099 | 8,175,716 | |
Commitments and Contingencies | ||||
Stockholders' Equity: | ||||
Common stock, $0.01 par value, 400,000,000 shares authorized, 109,569,315 and 109,401,721 shares issued and outstanding as of June 30, 2016 and December 31, 2015, respectively | 1,096 | 1,094 | ||
Additional paid-in capital | 735,220 | 734,610 | ||
Accumulated other comprehensive income (loss) | 7,594 | (2,854) | ||
Accumulated deficit | (39,202) | (11,583) | ||
Company's stockholders' equity | 863,967 | 880,526 | ||
Stockholders' Equity Attributable to Noncontrolling Interest | 3,076 | 0 | ||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 867,043 | 880,526 | ||
Total Liabilities and Stockholders' Equity | 9,388,142 | 9,056,242 | ||
Series B Preferred Stock | ||||
Stockholders' Equity: | ||||
Preferred stock, value | 72,397 | 72,397 | ||
Series C Preferred Stock | ||||
Stockholders' Equity: | ||||
Preferred stock, value | 86,862 | 86,862 | ||
Portfolio investments | ||||
Liabilities: | ||||
Outstanding Financing Arrangements | 618,050 | 577,413 | ||
Residential Mortgage Loans Held in Securitization | ||||
Liabilities: | ||||
Outstanding Financing Arrangements | 174,798 | 212,155 | ||
Residential collateralized debt obligations | ||||
Liabilities: | ||||
Collateralized debt obligations | 102,597 | 116,710 | ||
Multi-family collateralized debt obligations, at fair value | ||||
Liabilities: | ||||
Collateralized debt obligations | 6,981,813 | 6,818,901 | ||
Residential mortgage loans held in securitization trusts, net | ||||
ASSETS | ||||
Residential mortgage loans held in securitization trusts (net) | 106,173 | 119,921 | ||
Distressed residential mortgage loans, net | ||||
ASSETS | ||||
Residential mortgage loans held in securitization trusts (net) | $ 543,361 | $ 558,989 | ||
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. | |||
[2] | Our condensed consolidated balance sheets include assets and liabilities of consolidated variable interest entities ("VIEs") as the Company is the primary beneficiary of these VIEs. As of June 30, 2016 and December 31, 2015, assets of consolidated VIEs totaled $7,706,398 and $7,413,082, respectively, and the liabilities of consolidated VIEs totaled $7,352,486 and $7,077,175, respectively. See Note 7 for further discussion. | |||
[3] | Includes FHLBI advances amounting to $121.0 million as of December 31, 2015. |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Pledged securities | $ 700,817 | $ 639,683 |
Assets of consolidated VIE | 7,706,398 | 7,413,082 |
Liabilities of consolidated VIE | $ 7,352,486 | $ 7,077,175 |
Preferred stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Preferred stock, shares issued (in shares) | 6,600,000 | 6,600,000 |
Preferred stock, shares outstanding (in shares) | 6,600,000 | 6,600,000 |
Common stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 109,569,315 | 109,401,721 |
Common stock, shares outstanding (in shares) | 109,401,721 | 109,401,721 |
Series B Preferred Stock | ||
Preferred stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, cumulative redeemable dividend rate | 7.75% | 7.75% |
Preferred stock, liquidation preference per share (in Dollars per share) | $ 25 | $ 25 |
Preferred stock, shares authorized (in shares) | 6,000,000 | 6,000,000 |
Preferred stock, shares issued (in shares) | 3,000,000 | 3,000,000 |
Preferred stock, shares outstanding (in shares) | 3,000,000 | 3,000,000 |
Series C Preferred Stock | ||
Preferred stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, cumulative redeemable dividend rate | 7.875% | 7.875% |
Preferred stock, liquidation preference per share (in Dollars per share) | $ 25 | $ 25 |
Preferred stock, shares authorized (in shares) | 4,140,000 | 4,140,000 |
Preferred stock, shares issued (in shares) | 3,600,000 | 3,600,000 |
Preferred stock, shares outstanding (in shares) | 3,600,000 | 3,600,000 |
Available-for-sale securities | ||
Assets held in securitization trusts | $ 42,271 | $ 40,734 |
Distressed residential mortgage loans held in securitization trust, (net) | ||
Loans, carrying value | $ 225,370 | $ 114,214 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
INTEREST INCOME: | ||||
Investment securities and other | $ 8,591,000 | $ 10,196,000 | $ 17,025,000 | $ 21,540,000 |
Total interest income | 79,766,000 | 84,400,000 | 161,392,000 | 173,385,000 |
INTEREST EXPENSE: | ||||
Interest expense | 3,962,000 | 3,442,000 | 7,811,000 | 6,905,000 |
Subordinated debentures | 508,000 | 468,000 | 1,009,000 | 928,000 |
Total interest expense | 63,102,000 | 64,097,000 | 127,086,000 | 131,481,000 |
NET INTEREST INCOME | 16,664,000 | 20,303,000 | 34,306,000 | 41,904,000 |
OTHER INCOME (LOSS): | ||||
Recovery (provision) for loan losses | 42,000 | (112,000) | 688,000 | (548,000) |
Realized gain (loss) on investment securities and related hedges, net | 1,761,000 | (1,291,000) | 3,027,000 | (167,000) |
Gain on de-consolidation of multi-family loans held in securitization trust and multi-family collateralized debt obligations | 0 | 0 | 0 | 1,483,000 |
Realized gain on distressed residential mortgage loans | 26,000 | 3,614,000 | 5,574,000 | 4,290,000 |
Unrealized (loss) gain on investment securities and related hedges, net | (667,000) | 4,716,000 | (3,159,000) | (1,012,000) |
Unrealized gain on multi-family loans and debt held in securitization trusts, net | 784,000 | 5,418,000 | 1,602,000 | 19,046,000 |
Other income | 8,125,000 | 2,300,000 | 11,198,000 | 4,586,000 |
Total other income | 10,071,000 | 14,645,000 | 18,930,000 | 27,678,000 |
Base management and incentive fees | 2,979,000 | 4,141,000 | 6,504,000 | 11,011,000 |
Expenses related to distressed residential mortgage loans | 2,740,000 | 2,682,000 | 5,934,000 | 4,566,000 |
Other general and administrative expenses | 4,217,000 | 2,316,000 | 6,857,000 | 4,408,000 |
Total general, administrative and other expenses | 9,936,000 | 9,139,000 | 19,295,000 | 19,985,000 |
INCOME FROM OPERATIONS BEFORE INCOME TAXES | 16,799,000 | 25,809,000 | 33,941,000 | 49,597,000 |
Income tax expense | 2,366,000 | 1,178,000 | 2,557,000 | 1,423,000 |
NET INCOME | 14,433,000 | 24,631,000 | 31,384,000 | 48,174,000 |
Net loss attributable to non-controlling interest | 2,000 | 0 | 1,711 | 0 |
NET INCOME ATTRIBUTABLE TO COMPANY | 14,435,000 | 24,631,000 | 31,386,000 | 48,174,000 |
Preferred stock dividends | (3,225,000) | (3,087,000) | (6,450,000) | (4,540,000) |
NET INCOME ATTRIBUTABLE TO COMPANY'S COMMON STOCKHOLDERS | $ 11,210,000 | $ 21,544,000 | $ 24,936,000 | $ 43,634,000 |
Basic income per common share (in Dollars per share) | $ 0.10 | $ 0.20 | $ 0.23 | $ 0.41 |
Diluted income per common share (in Dollars per share) | $ 0.10 | $ 0.20 | $ 0.23 | $ 0.41 |
Weighted average shares outstanding-basic (in Shares) | 109,489 | 109,252 | 109,445 | 107,380 |
Weighted average shares outstanding-diluted (in Shares) | 109,489 | 109,252 | 109,445 | 107,380 |
Securitized debt | ||||
INTEREST EXPENSE: | ||||
Interest expense | $ 3,096,000 | $ 2,974,000 | $ 5,227,000 | $ 6,101,000 |
Multi-family loans held in securitization trusts | ||||
INTEREST INCOME: | ||||
Interest income | 61,769,000 | 62,984,000 | 125,301,000 | 129,284,000 |
Residential mortgage loans held in securitization trusts | ||||
INTEREST INCOME: | ||||
Interest income | 921,000 | 895,000 | 1,757,000 | 2,075,000 |
Distressed residential mortgage loans | ||||
INTEREST INCOME: | ||||
Interest income | 8,485,000 | 10,325,000 | 17,309,000 | 20,486,000 |
Multi-family collateralized debt obligations | ||||
INTEREST EXPENSE: | ||||
Interest expense | 55,224,000 | 56,992,000 | 112,424,000 | 117,087,000 |
Residential collateralized debt obligations | ||||
INTEREST EXPENSE: | ||||
Interest expense | $ 312,000 | $ 221,000 | $ 615,000 | $ 460,000 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Statement [Abstract] | ||||
NET INCOME ATTRIBUTABLE TO COMPANY'S COMMON STOCKHOLDERS | $ 11,210 | $ 21,544 | $ 24,936 | $ 43,634 |
OTHER COMPREHENSIVE INCOME | ||||
Increase (decrease) in fair value of available for sale securities | 3,713 | (3,490) | 11,575 | (353) |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax | 0 | 9,063 | 0 | 9,063 |
(Decrease) increase in fair value of derivative instruments utilized for cash flow hedges | (225) | 99 | (1,127) | (1,162) |
OTHER COMPREHENSIVE INCOME (LOSS) | 3,488 | (12,454) | 10,448 | (10,578) |
COMPREHENSIVE INCOME ATTRIBUTABLE TO COMPANY'S COMMON STOCKHOLDERS | $ 14,698 | $ 9,090 | $ 35,384 | $ 33,056 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement of Changes in Stockholders' Equity - USD ($) | Total | Common Stock | Preferred Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive (Loss) Income |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | $ 48,174,000 | |||||
Increase in fair value on available for sale securities | (353,000) | |||||
Decrease in fair value of derivative instruments utilized for cash flow hedges | (1,162,000) | |||||
Net income attributable to Company's common stockholders– Basic | 48,174,000 | |||||
Net Income (Loss) Attributable to Noncontrolling Interest | 0 | |||||
Stockholders' Equity Attributable to Noncontrolling Interest | 0 | |||||
Company's stockholders' equity | 880,526,000 | |||||
Beginning Balance at Dec. 31, 2015 | 880,526,000 | $ 1,094,000 | $ 159,259,000 | $ 734,610,000 | $ (11,583,000) | $ (2,854,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 31,384,000 | 31,386,000 | ||||
Stock issuance, net | 612,000 | 2,000 | 0 | 610,000 | ||
Dividends declared on common and preferred stock | (59,005,000) | (59,005,000) | ||||
Increase in fair value on available for sale securities | 11,575,000 | 11,575,000 | ||||
Decrease in fair value of derivative instruments utilized for cash flow hedges | (1,127,000) | (1,127,000) | ||||
Noncontrolling Interest, Increase from Business Combination | 3,078,000 | |||||
Ending Balance at Jun. 30, 2016 | 867,043,000 | $ 1,096,000 | $ 159,259,000 | $ 735,220,000 | $ (39,202,000) | $ 7,594,000 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income attributable to Company's common stockholders– Basic | 31,386,000 | |||||
Net Income (Loss) Attributable to Noncontrolling Interest | (1,711) | |||||
Stockholders' Equity Attributable to Noncontrolling Interest | 3,076,000 | |||||
Company's stockholders' equity | $ 863,967,000 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Noncontrolling Interest, Increase from Business Combination | $ 3,078 | |||
Cash Flows from Operating Activities: | ||||
Net income (loss) | $ 14,433 | $ 24,631 | 31,384 | $ 48,174 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Net amortization (accretion) | 3,745 | (1,298) | ||
Realized (gain) loss on investment securities and related hedges, net | (1,761) | 1,291 | (3,027) | 167 |
Realized gain on distressed residential mortgage loans | (5,574) | (4,290) | ||
Unrealized loss on investment securities and related hedges, net | 667 | (4,716) | 3,159 | 1,012 |
Gain on de-consolidation of multi-family loans held in securitization trusts and multi-family collateralized debt obligations | 0 | 0 | 0 | (1,483) |
Gain on remeasurement of existing membership interest in businesses acquired | (5,045) | 0 | ||
Gain on bargain purchase on businesses acquired | (65) | 0 | ||
Unrealized gain on loans and debt held in multi-family securitization trusts | (1,602) | (19,046) | ||
Net decrease in loans held for sale | 432 | 10 | ||
(Recovery of) provision for loan losses | (42) | 112 | (688) | 548 |
Income from investments in limited partnerships and limited liability companies | (8,794) | (5,856) | ||
Distributions of income from investments in limited partnership and limited liability companies | 9,602 | 3,924 | ||
Amortization of stock based compensation, net | 514 | 458 | ||
Changes in operating assets and liabilities: | ||||
Receivables and other assets | (1,060) | 6,919 | ||
Accrued expenses and other liabilities | 1,035 | (14,667) | ||
Net cash provided by operating activities | 24,016 | 14,572 | ||
Payments to Acquire Businesses, Net of Cash Acquired | (28,455) | 0 | ||
Cash Flows from Investing Activities: | ||||
Restricted cash | (34,934) | 3,167 | ||
Proceeds from Sale of Long-term Investments | 177,874 | 0 | ||
Purchases of investment securities | (274,623) | (5,265) | ||
Payments to Acquire Available-for-sale Securities, Equity | 5,423 | (5,445) | ||
Purchases of other assets | (81) | (6) | ||
Funding of mezzanine loans, equity and preferred equity investments | (8,430) | (25,101) | ||
Net proceeds (payments) on other derivative instruments settled during the period | 2,996 | (2,178) | ||
Principal paydowns on investment securities - available for sale | 58,602 | 37,748 | ||
Proceeds from Sale of Real Estate Held-for-investment | 1,000 | 547 | ||
Proceeds from sales of loans held in multi-family securitization trusts | 0 | 44,261 | ||
Net cash (used in) provided by investing activities | (17,422) | 118,140 | ||
Cash Flows from Financing Activities: | ||||
Net Proceeds from (payments made on) financing arrangements, including FHLBI advances and payments | 3,280 | (68,514) | ||
Proceeds from issuance of securitized debt | 167,724 | 0 | ||
Common stock issuance, net | 98 | 31,832 | ||
Preferred stock issuance, net | 0 | 86,862 | ||
Payments made on residential collateralized debt obligations | (41,336) | (41,572) | ||
Early Repayment of Senior Debt | 16,255 | |||
Redemption of preferred equity | 0 | |||
Net cash used in financing activities | (18,612) | (101,849) | ||
Net (Decrease) Increase in Cash and Cash Equivalents | (12,018) | 30,863 | ||
Cash and Cash Equivalents - Beginning of Period | 61,959 | 75,598 | ||
Cash and Cash Equivalents - End of Period | 49,941 | 106,461 | 49,941 | 106,461 |
Supplemental Disclosure: | ||||
Cash paid for interest | 150,569 | 157,462 | ||
Cash paid for income taxes | 1,555 | 2,300 | ||
Non-Cash Investment Activities: | ||||
Sales of investment securities not yet settled | 0 | 121,508 | ||
Purchase of investment securities not yet settled | 286,452 | 389,097 | ||
Deconsolidation of multi-family loans held in securitization trusts | 0 | 1,075,529 | ||
Deconsolidation of multi-family collateralized debt obligations | 0 | 1,031,268 | ||
Common Stock | ||||
Cash Flows from Financing Activities: | ||||
Dividends paid | (52,515) | (57,523) | ||
Non-Cash Financing Activities: | ||||
Dividends declared on stock to be paid in subsequent period | 26,296 | 29,538 | 26,296 | 29,538 |
Preferred Stock | ||||
Cash Flows from Financing Activities: | ||||
Dividends paid | (6,450) | (2,906) | ||
Non-Cash Financing Activities: | ||||
Dividends declared on stock to be paid in subsequent period | $ 3,225 | $ 3,087 | 3,225 | 3,087 |
Distressed Residential Mortgage Loans | ||||
Cash Flows from Investing Activities: | ||||
Principal repayments received on loans | 13,245 | 11,634 | ||
Purchases of residential mortgage loans and distressed residential mortgage loans | (46,595) | (30,038) | ||
Distressed residential mortgage loans held in securitization trust, (net) | ||||
Cash Flows from Investing Activities: | ||||
Principal repayments received on loans | 57,562 | 51,115 | ||
Multi-family collateralized debt obligations, at fair value | ||||
Cash Flows from Investing Activities: | ||||
Principal repayments received on loans | 58,994 | 37,701 | ||
Residential collateralized debt obligations | ||||
Cash Flows from Financing Activities: | ||||
Payments made on residential collateralized debt obligations | (14,171) | (12,334) | ||
Collateralized Loan Obligation | ||||
Cash Flows from Financing Activities: | ||||
Payments made on residential collateralized debt obligations | $ (58,987) | $ (37,694) |
Organization
Organization | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization New York Mortgage Trust, Inc., together with its consolidated subsidiaries ("NYMT," "we," "our," or the “Company"), is a real estate investment trust, or REIT, in the business of acquiring, investing in, financing and managing primarily mortgage-related assets and financial assets. Our objective is to deliver stable distributions to our stockholders over diverse economic conditions through a combination of income generated by net interest margin and net realized capital gains from our diversified investment portfolio. Our portfolio includes residential mortgage loans, including loans sourced from distressed markets, multi-family CMBS, preferred equity and joint venture equity investments in, and mezzanine loans to, owners of multi-family properties, equity securities issued by entities that invest in residential and commercial real estate, Agency RMBS consisting of fixed-rate, adjustable-rate and hybrid adjustable-rate RMBS and Agency IOs consisting of interest only and inverse interest-only RMBS that represent the right to the interest component of the cash flow from a pool of mortgage loans and certain other investments in mortgage-related and financial assets. The Company conducts its business through the parent company, New York Mortgage Trust, Inc., and several subsidiaries, including special purpose subsidiaries established for residential loan, distressed residential loan and CMBS securitization purposes, taxable REIT subsidiaries ("TRSs") and qualified REIT subsidiaries ("QRSs"). The Company consolidates all of its subsidiaries under generally accepted accounting principles in the United States of America (“GAAP”). The Company is organized and conducts its operations to qualify as a REIT for federal income tax purposes. As such, the Company will generally not be subject to federal income tax on that portion of its income that is distributed to stockholders if it distributes at least 90% of its REIT taxable income to its stockholders by the due date of its federal income tax return and complies with various other requirements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Definitions – The following defines certain of the commonly used terms in these financial statements: “RMBS” refers to residential adjustable-rate, hybrid adjustable-rate, fixed-rate, interest only and inverse interest only and principal only mortgage-backed securities; “Agency RMBS” refers to RMBS representing interests in or obligations backed by pools of mortgage loans issued or guaranteed by a federally chartered corporation (“GSE”), such as the Federal National Mortgage Association (“Fannie Mae”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac”), or an agency of the U.S. government, such as the Government National Mortgage Association (“Ginnie Mae”); “Non-Agency RMBS” refers to RMBS backed by prime jumbo mortgage loans including re-performing and non-performing loans; “IOs” refers collectively to interest only and inverse interest only mortgage-backed securities that represent the right to the interest component of the cash flow from a pool of mortgage loans; “POs” refers to mortgage-backed securities that represent the right to the principal component of the cash flow from a pool of mortgage loans; “Agency IOs” refers to an IO that represents the right to the interest component of the cash flows from a pool of residential mortgage loans issued or guaranteed by a GSE or an agency of the U.S. government; “ARMs” refers to adjustable-rate residential mortgage loans; “Prime ARM loans” and “residential securitized loans” each refer to prime credit quality residential ARM loans (“prime ARM loans”) held in securitization trusts; “Agency ARMs” refers to Agency RMBS comprised of adjustable-rate and hybrid adjustable-rate RMBS; “CMBS” refers to commercial mortgage-backed securities comprised of commercial mortgage pass-through securities, as well as IO or PO securities that represent the right to a specific component of the cash flow from a pool of commercial mortgage loans; “Multi-family CMBS” refers to CMBS backed by commercial mortgage loans on multi-family properties; “CDOs” refers to collateralized debt obligations; and “CLO” refers to collateralized loan obligations. Basis of Presentation – The accompanying condensed consolidated balance sheet as of December 31, 2015 has been derived from audited financial statements. The accompanying condensed consolidated balance sheet as of June 30, 2016 , the accompanying condensed consolidated statements of operations for the three and six months ended June 30, 2016 and 2015 , the accompanying condensed consolidated statements of comprehensive income for the three and six months ended June 30, 2016 and 2015 , the accompanying condensed consolidated statement of changes in stockholders’ equity for the six months ended June 30, 2016 and the accompanying condensed consolidated statements of cash flows for the six months ended June 30, 2016 and 2015 are unaudited. In our opinion, all adjustments (which include only normal recurring adjustments) necessary to present fairly the Company’s financial position, results of operations and cash flows have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with Article 10 of Regulation S-X and the instructions to Form 10-Q. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2015 , as filed with the U.S. Securities and Exchange Commission (“SEC”). The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the operating results for the full year. The accompanying condensed consolidated financial statements have been prepared on the accrual basis of accounting in accordance with GAAP. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management has made significant estimates in several areas, including valuation of its CMBS investments, multi-family loans held in securitization trusts and multi-family CDOs, as well as, income recognition on distressed residential mortgage loans purchased at a discount. Although the Company’s estimates contemplate current conditions and how it expects them to change in the future, it is reasonably possible that actual conditions could be different than anticipated in those estimates, which could materially impact the Company’s results of operations and its financial condition. Reclassifications – Certain prior period amounts have been reclassified in the condensed consolidated financial statements to conform to current period presentation. Business Combinations – The Company evaluates each purchase transaction to determine whether the acquired assets meet the definition of a business. The Company accounts for business combinations by applying the acquisition method in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations . Transaction costs related to acquisition of a business are expensed as incurred and excluded from the fair value of consideration transferred. The identifiable assets acquired, liabilities assumed and non-controlling interests, if any, in an acquired entity are recognized and measured at their estimated fair values. The excess of the fair value of consideration transferred over the fair values of identifiable assets acquired, liabilities assumed and non-controlling interests, if any, in an acquired entity, net of fair value of any previously held interest in the acquired entity, is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets and liabilities. Contingent consideration is classified as a liability or equity, as applicable. Contingent consideration in connection with the acquisition of a business is measured at fair value on acquisition date, and unless classified as equity, is remeasured at fair value each reporting period thereafter until the consideration is settled, with changes in fair value included in net income. Net cash paid to acquire a business is classified as investing activities on the accompanying condensed consolidated statements of cash flows. On May 16, 2016, the Company acquired the outstanding membership interests in RiverBanc LLC ("RiverBanc"), RB Multifamily Investors LLC ("RBMI"), and RB Development Holding Company, LLC ("RBDHC") that were not previously owned by the Company through the consummation of separate membership interest purchase agreements, thereby increasing the Company's ownership of each of these entities to 100% ( see Note 19 ). Principles of Consolidation and Variable Interest Entities – The accompanying condensed consolidated financial statements of the Company include the accounts of all its subsidiaries which are majority-owned, controlled by the Company or a variable interest entity ("VIE") where the Company is the primary beneficiary. All significant intercompany accounts and transactions have been eliminated in consolidation. A VIE is an entity that lacks one or more of the characteristics of a voting interest entity. A VIE is defined as an entity in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The Company consolidates a VIE when it is the primary beneficiary of such VIE, herein referred to as a "Consolidated VIE". As primary beneficiary, it has both the power to direct the activities that most significantly impact the economic performance of the VIE and a right to receive benefits or absorb losses of the entity that could be potentially significant to the VIE. The Company is required to reconsider its evaluation of whether to consolidate a VIE each reporting period, based upon changes in the facts and circumstances pertaining to the VIE. Investment Securities Available for Sale – The Company's investment securities, where the fair value option has not been elected and which are reported at fair value with unrealized gains and losses reported in Other Comprehensive Income (“OCI”), include Agency RMBS, non-Agency RMBS and CMBS. The Company has elected the fair value option for its Agency IOs, U.S. Treasury securities, certain Agency ARMs and Agency fixed rate securities within the Agency IO portfolio, which measures unrealized gains and losses through earnings in the accompanying condensed consolidated statements of operations. The fair value option was elected for these investment securities to better match the accounting for these investment securities with the related derivative instruments within the Agency IO portfolio, which are not designated as hedging instruments for accounting purposes. The Company generally intends to hold its investment securities until maturity; however, from time to time, it may sell any of its securities as part of the overall management of its business. As a result, our investment securities are classified as available for sale securities. Realized gains and losses recorded on the sale of investment securities available for sale are based on the specific identification method and included in realized gain (loss) on investment securities and related hedges in the accompanying condensed consolidated statements of operations. Interest income on our investment securities available for sale is accrued based on the outstanding principal balance and their contractual terms. Purchase premiums or discounts on investment securities are amortized or accreted to interest income over the estimated life of the investment securities using the effective yield method. Adjustments to amortization are made for actual prepayment activity. Interest income on certain of our credit sensitive securities, such as our CMBS that were purchased at a discount to par value, is recognized based on the security’s effective interest rate. The effective interest rate on these securities is based on management’s estimate from each security of the projected cash flows, which are estimated based on assumptions related to fluctuations in interest rates, prepayment speeds and the timing and amount of credit losses. On at least a quarterly basis, management reviews and, if appropriate, adjusts its cash flow projections based on input and analysis received from external sources, internal models, and its judgment about interest rates, prepayment rates, the timing and amount of credit losses, and other factors. Changes in cash flows from those originally projected, or from those estimated at the last evaluation, may result in a prospective change in the yield/interest income recognized on these securities. A portion of the purchase discount on the Company’s first loss tranche PO multi-family CMBS is designated as non-accretable purchase discount or credit reserve, which partially mitigates the Company’s risk of loss on the mortgages collateralizing such multi-family CMBS, and is not expected to be accreted into interest income. The amount designated as a credit reserve may be adjusted over time, based on the actual performance of the security, its underlying collateral, actual and projected cash flow from such collateral, economic conditions and other factors. If the performance of a security with a credit reserve is more favorable than forecasted, a portion of the amount designated as credit reserve may be accreted into interest income over time. Conversely, if the performance of a security with a credit reserve is less favorable than forecasted, the amount designated as credit reserve may be increased, or impairment charges and writedowns of such securities to a new cost basis could be required. The Company accounts for debt securities that are of high credit quality (generally those rated AA or better by a Nationally Recognized Statistical Rating Organization, or NRSRO) at date of acquisition in accordance with ASC 320-10, Investments - Debt and Equity Securities ("ASC 320-10"). The Company accounts for debt securities that are not of high credit quality (i.e., those whose risk of loss is less than remote) or securities that can be contractually prepaid such that we would not recover our initial investment at the date of acquisition in accordance with ASC 325-40, Investments - Beneficial Interests in Securitized Financial Assets ("ASC 325-40"). The Company considers credit ratings, the underlying credit risk and other market factors in determining whether the debt securities are of high credit quality; however, securities rated lower than AA or an equivalent rating are not considered of high credit quality and are accounted for in accordance with ASC 325-40. If ratings are inconsistent among NRSROs, the Company uses the lower rating in determining whether the securities are of high credit quality. The Company assesses its impaired securities on at least a quarterly basis and designates such impairments as either “temporary” or “other-than-temporary” by applying the guidance prescribed in ASC 320-10. When the fair value of an investment security is less than its amortized cost as of the reporting balance sheet date, the security is considered impaired. If the Company intends to sell an impaired security, or it is more likely than not that it will be required to sell the impaired security before its anticipated recovery, then it must recognize an other-than-temporary impairment through earnings equal to the entire difference between the investment’s amortized cost and its fair value as of the balance sheet date. If the Company does not expect to sell an other-than-temporarily impaired security, only the portion of the other-than-temporary impairment related to credit losses is recognized through earnings with the remainder recognized as a component of other comprehensive income (loss) on the accompanying condensed consolidated balance sheets. Impairments recognized through other comprehensive income (loss) do not impact earnings. Following the recognition of an other-than-temporary impairment through earnings, a new cost basis is established for the security, which may not be adjusted for subsequent recoveries in fair value through earnings. However, other-than-temporary impairments recognized through earnings may be accreted back to the amortized cost basis of the security on a prospective basis through interest income. The determination as to whether an other-than-temporary impairment exists and, if so, the amount considered other-than-temporarily impaired is subjective, as such determinations are based on both factual and subjective information available at the time of assessment as well the Company’s estimates of the future performance and cash flow projections. As a result, the timing and amount of other-than-temporary impairments constitute material estimates that are susceptible to significant change. In determining the other-than temporary impairment related to credit losses for securities that are not of high credit quality, the Company compares the present value of the remaining cash flows expected to be collected at the prior reporting date or purchase date, whichever is most recent against the present value of the cash flows expected to be collected at the current financial reporting date. The Company considers information available about the past and expected future performance of underlying mortgage loans, including timing of expected future cash flows, prepayment rates, default rates, loss severities and delinquency rates. Residential Mortgage Loans Held in Securitization Trusts – Residential mortgage loans held in securitization trusts are comprised of certain ARM loans transferred to Consolidated VIEs that have been securitized into sequentially rated classes of beneficial interests. The Company accounted for these securitization trusts as financings which are consolidated into the Company’s financial statements. Residential mortgage loans held in securitization trusts are carried at their unpaid principal balances, net of unamortized premium or discount, unamortized loan origination costs and allowance for loan losses. Interest income is accrued and recognized as revenue when earned according to the terms of the mortgage loans and when, in the opinion of management, it is collectible. The accrual of interest on loans is discontinued when, in management’s opinion, the interest is not collectible in the normal course of business, but in all cases when payment becomes greater than 90 days delinquent. Loans return to accrual status when principal and interest become current and are anticipated to be fully collectible. We establish an allowance for loan losses based on management's judgment and estimate of credit losses inherent in our portfolio of residential mortgage loans held in securitization trusts. Estimation involves the consideration of various credit-related factors, including but not limited to, macro-economic conditions, current housing market conditions, loan-to-value ratios, delinquency status, historical credit loss severity rates, purchased mortgage insurance, the borrower's current economic condition and other factors deemed to warrant consideration. Additionally, we look at the balance of any delinquent loan and compare that to the current value of the collateralizing property. We utilize various home valuation methodologies including appraisals, broker pricing opinions, internet-based property data services to review comparable properties in the same area or consult with a real estate agent in the property's area. Acquired Distressed Residential Mortgage Loans – Distressed residential mortgage loans are comprised of pools of fixed and adjustable rate residential mortgage loans acquired by the Company at a discount, with evidence of credit deterioration since their origination and where it is possible that the Company will not collect all contractually required principal payments. Distressed residential mortgage loans held in securitization trusts are distressed residential mortgage loans transferred to Consolidated VIEs that have been securitized into beneficial interests. The Company accounted for these securitization trusts as financings which are consolidated into the Company’s financial statements. Acquired distressed residential mortgage loans that have evidence of deteriorated credit quality at acquisition are accounted for under ASC 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality ("ASC 310-30"). Management evaluates whether there is evidence of credit quality deterioration as of the acquisition date using indicators such as past due or modified status, risk ratings, recent borrower credit scores and recent loan-to-value percentages. Acquired distressed residential mortgage loans are recorded at fair value at the date of acquisition, with no allowance for loan losses. Under ASC 310-30, the acquired loans may be accounted for individually or aggregated and accounted for as a pool of loans if the loans being aggregated have common risk characteristics. A pool is accounted for as a single asset with a single composite interest rate and an expectation of aggregate cash flows. Once a pool is assembled, it is treated as if it was one loan for purposes of applying the accounting guidance. Under ASC 310-30, the excess of cash flows expected to be collected over the carrying amount of the loans, referred to as the “accretable yield,” is accreted into interest income over the life of the loans in each pool or individually using a level yield methodology. Accordingly, our acquired distressed residential mortgage loans accounted for under ASC 310-30 are not subject to classification as nonaccrual classification in the same manner as our residential mortgage loans that were not distressed when acquired by us. Rather, interest income on acquired distressed residential mortgage loans relates to the accretable yield recognized at the pool level or on an individual loan basis, and not to contractual interest payments received at the loan level. The difference between contractually required principal and interest payments and the cash flows expected to be collected, referred to as the “nonaccretable difference,” includes estimates of both the impact of prepayments and expected credit losses over the life of the individual loan, or the pool (for loans grouped into a pool). Management monitors actual cash collections against its expectations, and revised cash flow estimates are prepared as necessary. A decrease in expected cash flows in subsequent periods may indicate that the loan pool or individual loan, as applicable, is impaired thus requiring the establishment of an allowance for loan losses by a charge to the provision for loan losses. An increase in expected cash flows in subsequent periods initially reduces any previously established allowance for loan losses by the increase in the present value of cash flows expected to be collected, and results in a recalculation of the amount of accretable yield for the loan pool. The adjustment of accretable yield due to an increase in expected cash flows is accounted for prospectively as a change in estimate. The additional cash flows expected to be collected are reclassified from the nonaccretable difference to the accretable yield, and the amount of periodic accretion is adjusted accordingly over the remaining life of the loans in the pool or individual loan, as applicable. The impacts of (i) prepayments, (ii) changes in variable interest rates, and (iii) any other changes in the timing of expected cash flows are recognized prospectively as adjustments to interest income. A distressed residential mortgage loan disposal, which may include a loan sale, receipt of payment in full from the borrower or foreclosure, results in removal of the loan from the loan pool at its allocated carrying amount. In the event of a sale of the loan and receipt of payment (in full or partial) from the borrower, a gain or loss on sale is recognized and reported based on the difference between the sales proceeds or payment from the borrower and the allocated carrying amount of the acquired distressed residential mortgage loan. In the case of a foreclosure, an individual loan is removed from the pool, a gain or loss on sale is recognized and reported based on the difference between the fair value of the underlying collateral less costs to sell and the carrying amount of the acquired distressed residential mortgage loan. The Company uses the specific allocation method for the removal of loans as the estimated cash flows and related carrying amount for each individual loan are known. In these cases, the remaining accretable yield is unaffected and any material change in remaining effective yield caused by the removal of the loan from the pool is addressed by the re-assessment of the estimate of cash flows for the pool prospectively. Acquired distressed residential mortgage loans subject to modification are not removed from the pool even if those loans would otherwise be considered troubled debt restructurings because the pool, and not the individual loan, represents the unit of account. For individual loans not accounted for in pools that are sold or satisfied by payment in full, a gain or loss on sale is recognized and reported based on the difference between the sales proceeds and the carrying amount of the acquired distressed residential mortgage loan. In the case of a foreclosure, a gain or loss sale is recognized and reported based on the difference between the fair value of the underlying collateral less costs to sell and the carrying amount of the acquired distressed residential mortgage loan. Multi-Family Loans Held in Securitization Trusts – Multi-family loans held in securitization trusts are comprised of multi-family mortgage loans held in 5 Freddie Mac-sponsored multi-family K-Series securitizations (the “Consolidated K-Series”) as of June 30, 2016 and December 31, 2015 . Based on a number of factors, we determined that we were the primary beneficiary of each VIE within the Consolidated K-Series, met the criteria for consolidation and, accordingly, have consolidated these Freddie Mac-sponsored multi-family K-Series securitizations, including their assets, liabilities, income and expenses in our financial statements. The Company has elected the fair value option on each of the assets and liabilities held within the Consolidated K-Series, which requires that changes in valuations be reflected in the Company's accompanying condensed consolidated statement of operations. The Company has adopted ASU 2014-13 effective January 1, 2016, which updates the guidance on measuring the financial assets and financial liabilities of consolidated collateralized financing entities, or CFEs. The update allows the Company to measure both the financial assets and financial liabilities of a qualifying CFE it consolidates using the fair value of either the CFE’s financial assets or financial liabilities, whichever is more observable. As the Company’s securitization trusts are considered qualifying CFEs, the Company determines the fair value of multi-family loans held in securitization trusts based on the fair value of its multi-family collateralized debt obligations and its retained interests from these securitizations (eliminated in consolidation in accordance with U.S. GAAP), as the fair value of these instruments is more observable. Interest income is accrued and recognized as revenue when earned according to the terms of the multi-family loans and when, in the opinion of management, it is collectible. The accrual of interest on multi-family loans is discontinued when, in management’s opinion, the interest is not collectible in the normal course of business, but in all cases when payment becomes greater than 90 days delinquent. The multi-family loans return to accrual status when principal and interest become current and are anticipated to be fully collectible. Mezzanine Loan and Preferred Equity Investments – The Company invests in mezzanine loans and preferred equity of entities that have significant real estate assets. The mezzanine loan is secured by a pledge of the borrower’s equity ownership in the property. Unlike a mortgage, this loan does not represent a lien on the property. Therefore, it is always junior and subordinate to any first-lien as well as second liens, if applicable, on the property. These loans are senior to any preferred equity or common equity interests. A preferred equity investment is an equity investment in the entity that owns the underlying property. Preferred equity is not secured by the underlying property, but holders have priority relative to common equity holders on cash flow distributions and proceeds from capital events. In addition, preferred equity holders may be able to enhance their position and protect their equity position with covenants that limit the entity’s activities and grant the holder the exclusive right to control the property after an event of default. Mezzanine loans and preferred equity investments, where the risks and payment characteristics are equivalent to mezzanine loans, are accounted for as loans and are stated at unpaid principal balance, adjusted for any unamortized premium or discount, deferred fees or expenses, net of valuation allowances. The Company has evaluated its mezzanine loan and preferred equity investments for accounting treatment as loans versus equity investment utilizing the guidance provided by the ADC Arrangements Subsection of ASC 310, Receivables . For mezzanine loan and preferred equity investments where the characteristics, facts and circumstances indicate that loan accounting treatment is appropriate, the Company accretes or amortizes any discounts or premiums and deferred fees and expenses over the life of the related asset utilizing the effective interest method or straight line-method, if the result is not materially different. Management evaluates the collectibility of both interest and principal of each of these loans, if circumstances warrant, to determine whether they are impaired. A loan is impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due according to the existing contractual terms. When a loan is impaired, the amount of the loss accrual is calculated by comparing the carrying amount of the investment to the estimated fair value of the loan or, as a practical expedient, to the value of the collateral if the loan is collateral dependent. Interest income is accrued and recognized as revenue when earned according to the terms of the loans and when, in the opinion of management, it is collectible. The accrual of interest on loans is discontinued when, in management’s opinion, the interest is not collectible in the normal course of business, but in all cases when payment becomes greater than 90 days delinquent. Loans return to accrual status when principal and interest become current and are anticipated to be fully collectible. The Company had mezzanine loan and preferred equity investments accounted for as loans in the amounts of $75.3 million and $44.2 million as of June 30, 2016 and December 31, 2015 , respectively. Mezzanine loans and preferred equity investments where the risks and payment characteristics are equivalent to an equity investment are accounted for using the equity method of accounting. See “ Investment in Unconsolidated Entities. ” Mortgage Loans Held for Investment – Mortgage loans held for investment are stated at unpaid principal balance, adjusted for any unamortized premium or discount, deferred fees or expenses, net of valuation allowances, and are included in receivables and other assets. Interest income is accrued on the principal amount of the loan based on the loan’s contractual interest rate. Amortization of premiums and discounts is recorded using the effective yield method. Interest income, amortization of premiums and discounts and prepayment fees are reported in interest income. A loan is considered to be impaired when it is probable that based upon current information and events, the Company will be unable to collect all amounts due under the contractual terms of the loan agreement. Based on the facts and circumstances of the individual loans being impaired, loan specific valuation allowances are established for the excess carrying value of the loan over either: (i) the present value of expected future cash flows discounted at the loan’s original effective interest rate, (ii) the estimated fair value of the loan’s underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan’s observable market price. Investment in Unconsolidated Entities – Non-controlling, unconsolidated ownership interests in an entity may be accounted for using the equity method or the cost method. In circumstances where the Company has a non-controlling interest but either owns a significant interest or is able to exert influence over the affairs of the enterprise, the Company utilizes the equity method of accounting. Under the equity method of accounting, the initial investment is increased each period for additional capital contributions and a proportionate share of the entity’s earnings or preferred return and decreased for cash distributions and a proportionate share of the entity’s losses. Management periodically reviews its investments for impairment based on projected cash flows from the entity over the holding period. When any impairment is identified, the investments are written down to recoverable amounts. The Company had investment in unconsolidated entities accounted for under the equity method in the amounts of $10.7 million and $20.1 million as of June 30, 2016 and December 31, 2015 , respectively. The Company may elect the fair value option for an investment in an unconsolidated entity that is accounted for using the equity method. The Company elected the fair value option for certain investments in unconsolidated entities that own interests (directly or indirectly) in commercial and residential real estate assets because the Company determined that such presentation rep |
Investment Securities Available
Investment Securities Available for Sale | 6 Months Ended |
Jun. 30, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment Securities Available for Sale | Investment Securities Available For Sale Investment securities available for sale consisted of the following as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 December 31, 2015 Amortized Cost Unrealized Fair Value Amortized Cost Unrealized Fair Value Gains Losses Gains Losses Agency RMBS (1) Agency ARMs Freddie Mac $ 44,256 $ 254 $ (149 ) $ 44,361 $ 62,383 $ 41 $ (770 ) $ 61,654 Fannie Mae 83,028 396 (197 ) 83,227 92,605 121 (1,334 ) 91,392 Ginnie Mae 7,114 — (232 ) 6,882 20,172 55 (260 ) 19,967 Total Agency ARMs 134,398 650 (578 ) 134,470 175,160 217 (2,364 ) 173,013 Agency Fixed Rate Freddie Mac 27,992 5 (165 ) 27,832 31,076 — (719 ) 30,357 Fannie Mae 348,547 139 (4,198 ) 344,488 380,684 — (12,149 ) 368,535 Ginnie Mae 507 — (3 ) 504 25,923 9 (111 ) 25,821 Total Agency Fixed Rate 377,046 144 (4,366 ) 372,824 437,683 9 (12,979 ) 424,713 Agency IOs (1) Freddie Mac 23,185 628 (5,076 ) 18,737 28,970 680 (4,471 ) 25,179 Fannie Mae 37,709 1,052 (8,783 ) 29,978 39,603 433 (6,341 ) 33,695 Ginnie Mae 64,236 2,420 (9,361 ) 57,295 63,050 511 (7,045 ) 56,516 Total Agency IOs 125,130 4,100 (23,220 ) 106,010 131,623 1,624 (17,857 ) 115,390 Total Agency RMBS 636,574 4,894 (28,164 ) 613,304 744,466 1,850 (33,200 ) 713,116 Non-Agency RMBS 110,349 280 (258 ) 110,371 1,727 51 (211 ) 1,567 U.S. Treasury securities (1) 7,982 15 — 7,997 10,113 — (76 ) 10,037 CMBS (2) 52,274 12,603 (60 ) 64,817 28,692 12,042 — 40,734 Total investment securities available for sale $ 807,179 $ 17,792 $ (28,482 ) $ 796,489 $ 784,998 $ 13,943 $ (33,487 ) $ 765,454 (1) Included in investment securities available for sale are Agency IOs, Agency RMBS and U.S. Treasury securities managed by Midway that are measured at fair value through earnings. (2) Included in CMBS is $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively. Realized Gain or Loss Activity During the three and six months ended June 30, 2016 , the Company received proceeds of approximately $117.1 million and $177.9 million on sales of investment securities available for sale realizing a loss of approximately $0.5 million and $0.9 million, respectively. During the three and six months ended June 30, 2015 , the Company received proceeds of approximately $34.5 million , realizing approximately $3.2 million of net gains, from the sale of investment securities available for sale. Weighted Average Life Actual maturities of our available for sale securities are generally shorter than stated contractual maturities (with maturities up to 30 years ), as they are affected by periodic payments and prepayments of principal on the underlying mortgages. As of June 30, 2016 and December 31, 2015 , based on management’s estimates using the three month historical constant prepayment rate (“CPR”), the weighted average life of the Company’s available for sale securities portfolio was approximately 4.0 years and 5.0 years , respectively. The following table sets forth the weighted average lives our investment securities available for sale as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): Weighted Average Life June 30, 2016 December 31, 2015 0 to 5 years $ 652,280 $ 518,594 Over 5 to 10 years 141,421 219,747 10+ years 2,788 27,113 Total $ 796,489 $ 765,454 Portfolio Interest Reset Periods The following tables set forth the stated reset periods of our investment securities available for sale and investment securities available for sale held in securitization trusts at June 30, 2016 and December 31, 2015 at carrying value (dollar amounts in thousands): June 30, 2016 December 31, 2015 Less than 6 6 to 24 More than Total Less than 6 to 24 More than Total Agency RMBS $ 71,056 $ 29,767 $ 512,481 $ 613,304 $ 92,693 $ 44,700 $ 575,723 $ 713,116 Non-Agency RMBS 1,320 — 109,051 110,371 188 1,379 — 1,567 U.S. Treasury securities 7,997 — — 7,997 10,037 — — 10,037 CMBS 22,546 — 42,271 64,817 — — 40,734 40,734 Total investment securities available for sale $ 102,919 $ 29,767 $ 663,803 $ 796,489 $ 102,918 $ 46,079 $ 616,457 $ 765,454 Unrealized Losses in OCI The following tables present the Company's investment securities available for sale in an unrealized loss position reported through OCI, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 Less than 12 Months Greater than 12 months Total Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Agency RMBS $ 4,478 $ (25 ) $ 375,146 $ (4,916 ) $ 379,624 $ (4,941 ) Non-Agency RMBS 21,114 (128 ) 148 (130 ) $ 21,262 $ (258 ) CMBS 10,269 (60 ) — — $ 10,269 $ (60 ) Total investment securities available for sale $ 35,861 $ (213 ) $ 375,294 $ (5,046 ) $ 411,155 $ (5,259 ) December 31, 2015 Less than 12 Months Greater than 12 months Total Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Agency RMBS $ 71,587 $ (688 ) $ 476,157 $ (14,497 ) $ 547,744 $ (15,185 ) Non-Agency RMBS 771 — 796 (211 ) $ 1,567 $ (211 ) Total investment securities available for sale $ 72,358 $ (688 ) $ 476,953 $ (14,708 ) $ 549,311 $ (15,396 ) Other than Temporary Impairment For the three and six months ended June 30, 2016 and 2015 , the Company recognized no other-than-temporary impairment through earnings. |
Residential Mortgage Loans Held
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned | 6 Months Ended |
Jun. 30, 2016 | |
Mortgage Loans on Real Estate [Abstract] | |
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned | Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned Residential mortgage loans held in securitization trusts (net) consist of the following as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Unpaid principal balance $ 109,214 $ 122,545 Deferred origination costs – net 691 775 Reserve for loan losses (3,732 ) (3,399 ) Total $ 106,173 $ 119,921 Allowance for Loan Losses - The following table presents the activity in the Company's allowance for loan losses on residential mortgage loans held in securitization trusts for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 3,399 $ 3,631 Provisions for loan losses 409 656 Transfer to real estate owned — 1 Charge-offs (76 ) (196 ) Balance at the end of period $ 3,732 $ 4,092 On an ongoing basis, the Company evaluates the adequacy of its allowance for loan losses. The Company’s allowance for loan losses as of June 30, 2016 was $3.7 million , representing 342 basis points of the outstanding principal balance of residential loans held in securitization trusts, as compared to 277 basis points as of December 31, 2015 . As part of the Company’s allowance for loan loss adequacy analysis, management will assess an overall level of allowances while also assessing credit losses inherent in each non-performing residential mortgage loan held in securitization trusts. These estimates involve the consideration of various credit related factors, including but not limited to, current housing market conditions, current loan to value ratios, delinquency status, the borrower’s current economic and credit status and other relevant factors. Real Estate Owned – The following table presents the activity in the Company’s real estate owned held in residential securitization trusts for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 411 $ 965 Write downs — — Transfer from/(to) mortgage loans held in securitization trusts — (192 ) Disposal (339 ) (362 ) Balance at the end of period $ 72 $ 411 Real estate owned held in residential securitization trusts are included in receivables and other assets on the accompanying condensed consolidated balance sheets and write downs are included in provision for loan losses in the accompanying condensed consolidated statements of operations for reporting purposes. All of the Company’s mortgage loans and real estate owned held in residential securitization trusts are pledged as collateral for the Residential CDOs issued by the Company. The Company’s net investment in the residential securitization trusts, which is the maximum amount of the Company’s investment that is at risk to loss and represents the difference between (i) the carrying amount of the mortgage loans, real estate owned and receivables held in residential securitization trusts and (ii) the amount of Residential CDOs outstanding, was $4.4 million and $4.4 million as of June 30, 2016 and December 31, 2015 , respectively. Delinquency Status of Our Residential Mortgage Loans Held in Securitization Trusts As of June 30, 2016 , we had 30 delinquent loans with an aggregate principal amount outstanding of approximately $12.4 million categorized as residential mortgage loans held in securitization trusts (net), of which $11.6 million , or 94% , are under some form of temporary modified payment plan. The table below shows delinquencies in our portfolio of residential mortgage loans held in securitization trusts, including REO through foreclosure, as of June 30, 2016 (dollar amounts in thousands): June 30, 2016 Days Late Number of Delinquent Loans Total Unpaid Principal % of Loan Portfolio 30 - 60 — $ — — % 61 - 90 1 $ 118 0.11 % 90 + 29 $ 12,277 11.22 % Real estate owned through foreclosure 1 $ 168 0.15 % As of December 31, 2015 , we had 31 delinquent loans with an aggregate principal amount outstanding of approximately $18.0 million categorized as residential mortgage loans held in securitization trusts (net), of which $11.9 million , or 67% , are under some form of modified payment plan. The table below shows delinquencies in our portfolio of residential mortgage loans held in securitization trusts, including real estate owned through foreclosure (REO), as of December 31, 2015 (dollar amounts in thousands): December 31, 2015 Days Late Number of Delinquent Loans Total Unpaid Principal % of Loan Portfolio 30 - 60 3 $ 825 0.67 % 61 - 90 2 $ 1,763 1.43 % 90 + 26 $ 15,365 12.48 % Real estate owned through foreclosure 3 $ 574 0.47 % The geographic concentrations of credit risk exceeding 5% of the total loan balances in our residential mortgage loans held in securitization trusts and real estate owned held in residential securitization trusts as of June 30, 2016 and December 31, 2015 are as follows: June 30, 2016 December 31, 2015 New York 35.2 % 35.6 % Massachusetts 19.9 % 20.7 % New Jersey 10.3 % 11.1 % Florida 8.5 % 7.7 % Connecticut 7.1 % 6.5 % Maryland 5.1 % 4.9 % |
Distressed Residential Mortgage
Distressed Residential Mortgage Loans | 6 Months Ended |
Jun. 30, 2016 | |
Mortgage Loans on Real Estate [Abstract] | |
Distressed Residential Mortgage Loans | Distressed Residential Mortgage Loans As of June 30, 2016 and December 31, 2015 , the carrying value of the Company’s distressed residential mortgage loans, including distressed residential mortgage loans held in securitization trusts, amounts to approximately $ 543.4 million and $ 559.0 million , respectively. The Company considers its purchase price for the distressed residential mortgage loans, including distressed residential mortgage loans held in securitization trusts, to be at fair value at the date of acquisition. The Company only establishes an allowance for loan losses subsequent to acquisition. The following table presents information regarding the estimates of the contractually required payments, the cash flows expected to be collected, and the estimated fair value of the distressed residential mortgage loans acquired during the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): June 30, 2016 June 30, 2015 Contractually required principal and interest $ 88,907 $ 70,630 Non-accretable yield (7,470 ) (3,997 ) Expected cash flows to be collected 81,437 66,633 Accretable yield (43,613 ) (37,225 ) Fair value at the date of acquisition $ 37,824 $ 29,408 The following table details activity in accretable yield for the distressed residential mortgage loans, including distressed residential mortgage loans held in securitization trusts, for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): June 30, 2016 June 30, 2015 Balance at beginning of period $ 579,009 $ 640,416 Additions 51,288 44,485 Disposals (71,137 ) (34,897 ) Accretion (17,301 ) (20,486 ) Balance at end of period (1) $ 541,859 $ 629,518 (1) Accretable yield is the excess of the distressed residential mortgage loans’ cash flows expected to be collected over the purchase price. The cash flows expected to be collected represents the Company’s estimate of the amount and timing of undiscounted principal and interest cash flows. Additions include accretable yield estimates for purchases made during the period and reclassification to accretable yield from nonaccretable yield. Deletions include distressed residential mortgage loan dispositions, which include refinancing, sale and foreclosure of the underlying collateral and resulting removal of the distressed residential mortgage loans from the accretable yield, and reclassifications from accretable to nonaccretable yield. The reclassifications between accretable and nonaccretable yield and the accretion of interest income is based on various estimates regarding loan performance and the value of the underlying real estate securing the loans. As the Company continues to update its estimates regarding the loans and the underlying collateral, the accretable yield may change. Therefore, the amount of accretable income recorded in the six -month period ended June 30, 2016 and 2015 is not necessarily indicative of future results. The geographic concentrations of credit risk exceeding 5% of the unpaid principal balance of our distressed residential mortgage loans, including distressed residential mortgage loans held in securitization trusts, as of June 30, 2016 and December 31, 2015 , respectively, are as follows: June 30, 2016 December 31, 2015 Florida 11.9 % 12.6 % California 8.3 % 7.7 % North Carolina 8.0 % 8.1 % Georgia 6.1 % 6.1 % Maryland 5.2 % 5.4 % New York 5.0 % 5.2 % The Company's distressed residential mortgage loans held in securitization trusts with a carrying value of approximately $225.4 million and $114.2 million at June 30, 2016 and December 31, 2015 , respectively, are pledged as collateral for certain of the Securitized Debt issued by the Company ( see Note 7 ). In addition, distressed residential mortgage loans with a carrying value of approximately $256.4 million and $307.0 million at June 30, 2016 and December 31, 2015 , respectively, are pledged as collateral for a Master Repurchase Agreement with Deutsche Bank AG, Cayman Islands Branch ( see Note 10 ). |
Consolidated K-Series
Consolidated K-Series | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Text Block Supplement [Abstract] | |
Consolidated K-Series | Consolidated K-Series The Company has elected the fair value option on the assets and liabilities held within the Consolidated K-Series, which requires that changes in valuations in the assets and liabilities of the Consolidated K-Series be reflected in the Company's condensed consolidated statements of operations. Our investment in the Consolidated K-Series is limited to the multi-family CMBS comprised of first loss tranche PO securities and/or certain IOs issued by certain K-Series securitizations with an aggregate net carrying value of $300.3 million and $286.4 million at June 30, 2016 and December 31, 2015 , respectively ( see Note 7 ). The Consolidated K-Series is comprised of five K-Series securitizations as of June 30, 2016 and December 31, 2015 . The condensed consolidated balance sheets of the Consolidated K-Series at June 30, 2016 and December 31, 2015 , respectively, are as follows (dollar amounts in thousands): Balance Sheets June 30, 2016 December 31, 2015 Assets Multi-family loans held in securitization trusts $ 7,282,145 $ 7,105,336 Receivables 23,618 24,579 Total Assets $ 7,305,763 $ 7,129,915 Liabilities and Equity Multi-family CDOs $ 6,981,813 $ 6,818,901 Accrued expenses 23,523 24,483 Total Liabilities 7,005,336 6,843,384 Equity 300,427 286,531 Total Liabilities and Equity $ 7,305,763 $ 7,129,915 The multi-family loans held in securitization trusts had an unpaid principal balance of approximately $6.8 billion at June 30, 2016 and December 31, 2015 . The multi-family CDOs had an unpaid principal balance of approximately $6.8 billion at June 30, 2016 and December 31, 2015 . As of June 30, 2016 and December 31, 2015 , the current weighted average interest rate on these multi-family CDOs was 4.11% and 3.98% , respectively. The Company does not have any claims to the assets or obligations for the liabilities of the Consolidated K-Series (other than those securities represented by our first loss tranche securities). We have elected the fair value option for the Consolidated K-Series. The net fair value of our investment in the Consolidated K-Series, which represents the difference between the carrying values of multi-family loans held in securitization trusts less the carrying value of multi-family CDOs, approximates the fair value of our underlying securities. The fair value of our underlying securities is determined using the same valuation methodology as our CMBS investments available for sale ( see Note 14 ). The condensed consolidated statements of operations of the Consolidated K-Series for the three and six months ended June 30, 2016 and 2015 , respectively, are as follows (dollar amounts in thousands): Three Months Ended Six Months Ended Statements of Operations 2016 2015 2016 2015 Interest income $ 61,769 $ 62,984 $ 125,301 $ 129,284 Interest expense 55,224 56,992 112,424 117,087 Net interest income 6,545 5,992 12,877 12,197 Unrealized gain on multi-family loans and debt held in securitization trusts, net 784 5,418 1,602 19,046 Net Income $ 7,329 $ 11,410 $ 14,479 $ 31,243 The geographic concentrations of credit risk exceeding 5% of the total loan balances related to our CMBS investments included in investment securities available for sale and multi-family loans held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively, are as follows: June 30, 2016 December 31, 2015 California 13.9 % 13.8 % Texas 12.4 % 12.3 % New York 8.1 % 8.0 % Maryland 5.3 % 5.2 % |
Use of Special Purpose Entities
Use of Special Purpose Entities and Variable Interest Entities | 6 Months Ended |
Jun. 30, 2016 | |
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net [Abstract] | |
Use Of Special Purpose Entities And Variable Interest Entities | Use of Special Purpose Entities and Variable Interest Entities The Company uses SPEs to facilitate transactions that involve securitizing financial assets or re-securitizing previously securitized financial assets. The objective of such transactions may include obtaining non-recourse financing, obtaining liquidity or refinancing the underlying securitized financial assets on improved terms. Securitization involves transferring assets to an SPE to convert all or a portion of those assets into cash before they would have been realized in the normal course of business through the SPE’s issuance of debt or equity instruments. Investors in an SPE usually have recourse only to the assets in the SPE and depending on the overall structure of the transaction, may benefit from various forms of credit enhancement, such as over-collateralization in the form of excess assets in the SPE, priority with respect to receipt of cash flows relative to holders of other debt or equity instruments issued by the SPE, or a line of credit or other form of liquidity agreement that is designed with the objective of ensuring that investors receive principal and/or interest cash flow on the investment in accordance with the terms of their investment agreement. The Company has entered into resecuritization and financing transactions which required the Company to analyze and determine whether the SPEs that were created to facilitate the transactions are VIEs in accordance with ASC 810 and if so, whether the Company is the primary beneficiary requiring consolidation. The Company evaluated the following resecuritization and financing transactions: 1) its Residential CDOs completed in 2005; 2) its multi-family CMBS re-securitization transaction completed in May 2012; 3) its collateralized recourse financing transactions completed in November 2013 and 4) its distressed residential mortgage loan securitization transactions completed in December 2012, July 2013, September 2013 and April 2016 (each a “Financing VIE” and collectively, the “Financing VIEs”) and concluded that the entities created to facilitate each of the transactions are VIEs and that the Company is the primary beneficiary of these VIEs. Accordingly, the Company consolidated the Financing VIEs as of June 30, 2016 . The Company invests in multi-family CMBS consisting of PO securities that represent the first loss tranche of the securitizations from which they were issued, and certain IOs issued from Freddie Mac-sponsored multi-family K-Series securitization trusts. The Company has evaluated these CMBS investments in Freddie Mac-sponsored K-Series securitization trusts to determine whether they are VIEs and if so, whether the Company is the primary beneficiary requiring consolidation. The Company has determined that five Freddie Mac-sponsored multi-family K-Series securitization trusts as of June 30, 2016 and December 31, 2015 , respectively, are VIEs. The Company also determined that it is the primary beneficiary of each VIE within the Consolidated K-Series and, accordingly, has consolidated its assets, liabilities, income and expenses in the accompanying consolidated financial statements ( see Notes 2 and 6 ). One of the Company’s multi-family CMBS investments included in the Consolidated K-Series (herein referred to as a "Non-Financed VIE") is not subject to any financing as of June 30, 2016 and December 31, 2015 , respectively. In analyzing whether the Company is primary beneficiary of the Consolidated K-Series and the Financing VIEs, the Company considered its involvement in each of the VIEs, including the design and purpose of each VIE, and whether its involvement reflected a controlling financial interest that resulted in the Company being deemed the primary beneficiary of the VIEs. In determining whether the Company would be considered the primary beneficiary, the following factors were assessed: • whether the Company has both the power to direct the activities that most significantly impact the economic performance of the VIE; and • whether the Company has a right to receive benefits or absorb losses of the entity that could be potentially significant to the VIE. On May 16, 2016, the Company acquired the remaining outstanding membership interests in RBDHC, resulting in 100% ownership. RBDHC owns 50% of Kiawah River View Investors LLC ("KRVI"), a limited liability company that owns developed land and residential homes under development in Kiawah Island, SC, for which RiverBanc is the manager. The Company has evaluated KRVI to determine if it is a VIE and if so, whether the Company is the primary beneficiary requiring consolidation. The Company has determined that KRVI is a VIE for which RBDHC is the primary beneficiary as the Company, collectively through its wholly-owned subsidiaries RiverBanc and RBDHC, has both the power to direct the activities that most significantly impact the economic performance of KRVI and has a right to receive benefits or absorb losses of KRVI that could be potentially significant to KRVI. Accordingly, the Company has consolidated KRVI in its condensed consolidated financial statements with a non-controlling interest for the third-party ownership of KRVI membership interests. The Consolidated K-Series, the Financing VIEs, and KRVI are collectively referred to in this footnote as "Consolidated VIEs". The following tables present a summary of the assets and liabilities of these Consolidated VIEs as of June 30, 2016 and December 31, 2015 , respectively. Intercompany balances have been eliminated for purposes of this presentation. Assets and Liabilities of Consolidated VIEs as of June 30, 2016 (dollar amounts in thousands): Financing VIEs Other VIEs Multi-family CMBS re- securitization (1) Collateralized Recourse Financing (2) Distressed Residential Mortgage Loan Securitization (3) Residential Mortgage Loan Securitization Non-financed VIE - Multi- family CMBS (2) Other Total Cash and cash equivalents $ — $ — $ — $ — $ — $ 852 $ 852 Investment securities available for sale, at fair value held in securitization trusts 42,271 — — — — — 42,271 Residential mortgage loans held in securitization trusts (net) — — — 106,173 — — 106,173 Distressed residential mortgage loans held in securitization trust, (net) — — 225,370 — — — 225,370 Multi-family loans held in securitization trusts, at fair value 1,251,124 4,784,427 — — 1,246,594 — 7,282,145 Receivables and other assets 4,316 14,467 8,696 810 5,238 16,060 49,587 Total assets $ 1,297,711 $ 4,798,894 $ 234,066 $ 106,983 $ 1,251,832 $ 16,912 $ 7,706,398 Residential collateralized debt obligations $ — $ — $ — $ 102,597 $ — $ — $ 102,597 Multi-family collateralized debt obligations, at fair value 1,193,483 4,607,016 — — 1,181,314 — 6,981,813 Securitized debt 27,961 55,751 160,304 — — — 244,016 Accrued expenses and other liabilities 4,296 14,148 287 17 5,238 74 24,060 Total liabilities $ 1,225,740 $ 4,676,915 $ 160,591 $ 102,614 $ 1,186,552 $ 74 $ 7,352,486 (1) The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization ( see Note 6 ). (2) The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations ( see Note 6 ). One of the Company’s Freddie Mac-sponsored multi-family K-Series securitizations included in the Consolidated K-Series is not subject to any financing as of June 30, 2016 . (3) The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to a securitization transaction that closed in April 2016 that involved the issuance of $177.5 million of Class A Notes representing the beneficial ownership in a pool of performing and re-performing seasoned mortgage loans having an aggregate principal balance of approximately $282.8 million. The Company holds 5% of the Class A Notes issued as part of the securitization transaction. The Company has repaid the outstanding notes from its distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013 as of June 30, 2016. In connection with the repayment of the notes from the Company's distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013, the Company terminated and deconsolidated the Financing VIE that facilitated these financing transactions and the distressed residential loans serving as collateral on the notes were transferred back to the Company. Assets and Liabilities of Consolidated VIEs as of December 31, 2015 (dollar amounts in thousands): Financing VIEs Non-financed VIE Multi-family CMBS re- securitization (1) Collateralized Recourse Financing (2) Distressed Residential Mortgage Loan Securitization (3) Residential Mortgage Loan Securitization Multi- family CMBS Total Investment securities available for sale, at fair value held in securitization trusts $ 40,734 $ — $ — $ — $ — $ 40,734 Residential mortgage loans held in securitization trusts (net) — — — 119,921 — 119,921 Distressed residential mortgage loans held in securitization trust (net) — — 114,214 — — 114,214 Multi-family loans held in securitization trusts, at fair value 1,224,036 4,633,061 — — 1,248,239 7,105,336 Receivables and other assets 4,864 15,281 6,076 1,200 5,456 32,877 Total assets $ 1,269,634 $ 4,648,342 $ 120,290 $ 121,121 $ 1,253,695 $ 7,413,082 Residential collateralized debt obligations $ — $ — $ — $ 116,710 $ — $ 116,710 Multi-family collateralized debt obligations, at fair value 1,168,470 4,464,340 — — 1,186,091 6,818,901 Securitized debt 27,613 55,629 33,299 — — 116,541 Accrued expenses and other liabilities 4,436 14,750 368 13 5,456 25,023 Total liabilities $ 1,200,519 $ 4,534,719 $ 33,667 $ 116,723 $ 1,191,547 $ 7,077,175 (1) The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization ( see Note 6 ). (2) The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations ( see Note 6 ). (3) The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to distressed residential mortgage loan securitizations transactions completed in 2013. The outstanding notes from these transactions were repaid in February 2016. The following table summarizes the Company’s securitized debt collateralized by multi-family CMBS and distressed residential mortgage loans (dollar amounts in thousands): Multi-family CMBS Re-securitization (1) Collateralized Recourse Financing (2) Distressed Residential Mortgage Loan Securitizations Principal Amount at June 30, 2016 $ 33,666 $ 55,853 $ 162,411 Principal Amount at December 31, 2015 $ 33,781 $ 55,853 $ 33,656 Carrying Value at June 30, 2016 (3) $ 27,961 $ 55,751 $ 160,304 Carrying Value at December 31, 2015 (3) $ 27,613 $ 55,629 $ 33,299 Pass-through rate of Notes issued 5.35% One-month LIBOR plus 5.25% 4% - 4.85% (1) The Company engaged in the re-securitization transaction primarily for the purpose of obtaining non-recourse financing on a portion of its multi-family CMBS portfolio. As a result of engaging in this transaction, the Company remains economically exposed to the first loss position on the underlying multi-family CMBS transferred to the Consolidated VIE. The holders of the note issued in this re-securitization transaction have no recourse to the general credit of the Company, but the Company does have the obligation, under certain circumstances, to repurchase assets upon the breach of certain representations and warranties. The Company will receive all remaining cash flow, if any, through its retained ownership. (2) The Company entered into a CMBS Master Repurchase Agreement with a three -year term for the purpose of financing a portion of its multi-family CMBS portfolio. In connection with the transaction, the Company agreed to guarantee the due and punctual payment of its wholly-owned subsidiary's obligations under the CMBS Master Repurchase Agreement. (3) Classified as securitized debt in the liability section of the Company’s accompanying condensed consolidated balance sheets, net of debt issuance costs. The following table presents contractual maturity information about the Financing VIEs’ securitized debt as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): Scheduled Maturity (principal amount) June 30, 2016 December 31, 2015 Within 24 months $ 55,853 $ 89,509 Over 24 months to 36 months 162,411 — Over 36 months 33,666 33,781 Total outstanding principal 251,930 123,290 Discount (6,154 ) (5,763 ) Debt Issuance Cost (1,760 ) (986 ) Carrying value $ 244,016 $ 116,541 There is no guarantee that the Company will receive any cash flows from these securitization trusts. Residential Mortgage Loan Securitization Transaction The Company has completed four residential mortgage loan securitizations (other than the distressed residential mortgage loan securitizations discussed above) since inception, the first three were accounted for as permanent financings and have been included in the Company’s accompanying condensed consolidated financial statements. The fourth was accounted for as a sale and accordingly, is not included in the Company’s accompanying condensed consolidated financial statements. Unconsolidated VIEs The Company has evaluated its multi-family CMBS investments in two Freddie Mac-sponsored K-Series securitizations, mezzanine loan, preferred equity and other equity investments as of June 30, 2016 and December 31, 2015 , respectively, to determine whether they are VIEs and should be consolidated by the Company. Based on a number of factors, the Company determined that it does not have a controlling financial interest and is not the primary beneficiary of these VIEs. The following tables present the classification and carrying value of unconsolidated VIEs as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 Investment securities, available for sale, at fair value Receivables and other Assets Mezzanine loan and preferred equity investments Investment in unconsolidated entities Total Multi-family CMBS $ 42,271 $ 75 $ — $ — $ 42,346 Mezzanine/Construction loan on multi-family properties — — 19,180 — 19,180 Preferred equity investment on multi-family properties — — 56,120 10,784 66,904 Equity investment in entities that invest in multi-family properties — — — 22,955 22,955 Total assets $ 42,271 $ 75 $ 75,300 $ 33,739 $ 151,385 December 31, 2015 Investment securities, available for sale, at fair value Receivables and other Assets Mezzanine loan and preferred equity investments Investment in unconsolidated entities Total Multi-family CMBS $ 40,734 $ 76 $ — $ — $ 40,810 Mezzanine/Construction loan on multi-family properties — — 8,663 8,718 17,381 Preferred equity investment on multi-family properties — — 35,488 10,776 46,264 Equity investment in entities that invest in multi-family properties — — — 66,242 66,242 Total assets $ 40,734 $ 76 $ 44,151 $ 85,736 $ 170,697 Our maximum loss exposure on the multi-family CMBS investments, mezzanine loan and equity investments is approximately $151.4 million and $170.7 million at June 30, 2016 and December 31, 2015 , respectively. The Company’s maximum exposure does not exceed the carrying value of its investments. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company enters into derivative instruments in connection with its risk management activities. These derivative instruments include interest rate swaps, swaptions and futures. The Company may also purchase or sell short TBAs, purchase put or call options on U.S. Treasury futures or invest in other types of mortgage derivative securities. Derivatives Not Designated as Hedging Instruments The following table presents the fair value of derivative instruments that were not designated as hedging instruments and their location in our condensed consolidated balance sheets at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): Derivatives Not Designated Balance Sheet Location June 30, 2016 December 31, 2015 TBA securities Derivative assets $ 290,318 $ 226,929 U.S. Treasury futures Derivative assets 1,002 — Options on U.S. Treasury futures Derivative assets 27 15 Interest rate swap futures Derivative assets — 706 Swaptions Derivative assets 333 821 Eurodollar futures Derivative liabilities 4,572 1,242 Interest rate swap futures Derivative liabilities 759 — Interest rate swaps (1) Derivative liabilities 284 258 (1) Includes interest rate swaps in our Agency IO portfolio. Contracts in a liability position of $0.5 million have been netted against the asset position of $0.2 million in the accompanying condensed consolidated balance sheets at June 30, 2016 . There was no netting of interest rate swaps at December 31, 2015 . The tables below summarize the activity of derivative instruments not designated as hedges for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Notional Amount For the Six Months Ended June 30, 2016 Derivatives Not Designated as Hedging Instruments December 31, 2015 Additions Settlement, Expiration or Exercise June 30, 2016 TBA securities $ 222,000 $ 1,952,000 $ (1,893,000 ) $ 281,000 U.S. Treasury futures — 117,700 (78,000 ) 39,700 Interest rate swap futures (137,200 ) 546,600 (477,300 ) (67,900 ) Eurodollar futures (2,769,000 ) 1,640,000 (3,095,000 ) (4,224,000 ) Options on U.S. Treasury futures 28,000 66,000 (64,000 ) 30,000 Swaptions 159,000 — (5,000 ) 154,000 Interest rate swaps 10,000 5,000 — 15,000 Notional Amount For the Six Months Ended June 30, 2015 Derivatives Not Designated as Hedging Instruments December 31, 2014 Additions Settlement, Expiration or Exercise June 30, 2015 TBA securities $ 273,000 $ 2,176,000 $ (2,153,000 ) $ 296,000 U.S. Treasury futures 2,300 123,600 (135,400 ) (9,500 ) Interest rate swap futures (190,100 ) 597,800 (605,000 ) (197,300 ) Eurodollar futures (2,961,000 ) 1,463,000 (1,453,000 ) (2,951,000 ) Options on U.S. Treasury futures 21,000 187,000 (201,000 ) 7,000 Swaptions 180,000 9,000 — 189,000 Interest rate swaps 10,000 — — 10,000 The following tables present the components of realized and unrealized gains and losses related to our derivative instruments that were not designated as hedging instruments included in other income (expense) in our condensed consolidated statements of operations for the three and six months ended June 30, 2016 and 2015 (dollar amounts in thousands): Three Months Ended June 30, 2016 2015 Realized Gains (Losses) Unrealized Gains (Losses) Realized Gains (Losses) Unrealized Gains (Losses) TBA Securities $ 3,700 $ 1,454 $ (2,243 ) $ (2,749 ) Eurodollar futures (1) (724 ) (1,294 ) (1,032 ) 185 Interest rate swaps — 93 — 90 Swaptions — 150 — 516 U.S. Treasury and Interest rate swap futures and options (724 ) 923 (1,167 ) 1,350 Total $ 2,252 $ 1,326 $ (4,442 ) $ (608 ) Six Months Ended June 30, 2016 2015 Realized Gains (Losses) Unrealized Gains (Losses) Realized Gains (Losses) Unrealized Gains (Losses) TBA Securities $ 8,508 $ 3,430 $ 587 $ (2,095 ) Eurodollar futures (1) (1,506 ) (3,330 ) (1,279 ) (1,388 ) Interest rate swaps — (26 ) — (29 ) Swaptions — 22 — (41 ) U.S. Treasury and Interest rate swap futures and options (2,995 ) (461 ) (2,611 ) (1,707 ) Total $ 4,007 $ (365 ) $ (3,303 ) $ (5,260 ) (1) At June 30, 2016 , the Eurodollar futures consist of 4,224 contracts with expiration dates ranging between September 2016 and June 2018 . The use of TBAs exposes the Company to market value risk, as the market value of the securities that the Company is required to purchase pursuant to a TBA transaction may increase or decrease from the agreed-upon purchase price. At June 30, 2016 and December 31, 2015 , our condensed consolidated balance sheets include TBA-related liabilities of $286.5 million and $228.0 million included in payable for securities purchased, respectively. Open TBA purchases and sales involving the same counterparty, same underlying deliverable and the same settlement date are reflected in our condensed consolidated financial statements on a net basis. TBA sales amounting to approximately $193.3 million were netted against TBA purchases amounting to approximately $479.8 million at June 30, 2016 . There was $55.1 million netting of TBA sales against TBA purchases of $283.1 million at December 31, 2015 . Derivatives Designated as Hedging Instruments The Company’s interest rate swaps, except interest swaps included in its Agency IO portfolio, are used to hedge the variable cash flows associated with borrowings made under our financing arrangements including FHLBI advances until January 2016 and are designated as cash flow hedges. There were no costs incurred at the inception of the Company's interest rate swaps, under which the Company agrees to pay a fixed rate of interest and receive a variable interest rate based on one month LIBOR, on the notional amount of the interest rate swaps. The Company documents its risk-management policies, including objectives and strategies, as they relate to its hedging activities, and upon entering into hedging transactions, documents the relationship between the hedging instrument and the hedged liability contemporaneously. The Company assesses, both at inception of a hedge and on an on-going basis, whether or not the hedge is “highly effective” when using the matched term basis. The Company discontinues hedge accounting on a prospective basis and recognizes changes in the fair value through earnings when: (i) it is determined that the derivative is no longer effective in offsetting cash flows of a hedged item (including forecasted transactions); (ii) it is no longer probable that the forecasted transaction will occur; or (iii) it is determined that designating the derivative as a hedge is no longer appropriate. The Company’s derivative instruments are carried on the Company’s balance sheets at fair value, as assets, if their fair value is positive, or as liabilities, if their fair value is negative. For the Company’s derivative instruments that are designated as “cash flow hedges,” changes in their fair value are recorded in accumulated other comprehensive income (loss), provided that the hedges are effective. A change in fair value for any ineffective amount of the Company’s derivative instruments would be recognized in earnings. The Company has not recognized any change in the value of its existing derivative instruments designated as cash flow hedges through earnings as a result of ineffectiveness of any of its hedges. The following table presents the fair value of derivative instruments designated as hedging instruments and their location in the Company’s condensed consolidated balance sheets at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): Derivatives Designated as Hedging Instruments Balance Sheet Location Total Notional Amount June 30, 2016 December 31, 2015 Interest Rate Swaps Derivative liability $ 215,000 $ 823 $ — Interest Rate Swaps Derivative asset 350,000 — 304 The Company has netting arrangements by counterparty with respect to its interest rate swaps. There was no netting of interest rate swaps designated as hedging instruments at June 30, 2016 . The following table presents the impact of the Company’s derivative instruments on the Company’s accumulated other comprehensive income for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Six Months Ended June 30, Derivatives Designated as Hedging Instruments 2016 2015 Accumulated other comprehensive income for derivative instruments: Balance at beginning of the period $ 304 $ 1,135 Unrealized loss on interest rate swaps (1,127 ) (1,163 ) Balance at end of the period $ (823 ) $ (28 ) The Company estimates that over the next 12 months, approximately $0.8 million of the net unrealized gains on the interest rate swaps will be reclassified from accumulated other comprehensive income (loss) into earnings. The following table details the impact of the Company’s interest rate swaps designated as hedging instruments included in interest expense for the three and six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Interest income Interest expense-investment securities $ 209 $ 439 $ 427 $ 890 The following table presents information about our interest rate swaps (includes interest rate swaps in our Agency IO portfolio) whereby we receive floating rate payments in exchange for fixed rate payments as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Swap Maturities Notional Amount Weighted Average Fixed Interest Rate Weighted Average Notional Amount Weighted Average Fixed Interest Rate Weighted Average 2017 $ 215,000 0.83 % 0.45 % $ 215,000 0.83 % 0.39 % 2019 10,000 2.25 % 0.64 % 10,000 2.25 % 0.59 % Total $ 225,000 0.90 % 0.46 % $ 225,000 0.90 % 0.40 % The following table presents information about our interest rate swaps in our Agency IO portfolio whereby we receive fixed rate payments in exchange for floating rate payments as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Swap Maturities Notional Weighted Average Weighted Average Notional Weighted Average Weighted Average 2026 $ 5,000 1.80 % 0.62 % $ — — % — % Total $ 5,000 1.80 % 0.62 % $ — — % — % The use of derivatives exposes the Company to counterparty credit risks in the event of a default by a counterparty. If a counterparty defaults under the applicable derivative agreement, the Company may be unable to collect payments to which it is entitled under its derivative agreements and may have difficulty collecting the assets it pledged as collateral against such derivatives. The Company currently has in place with all counterparties bi-lateral margin agreements requiring a party to post collateral to the Company for any valuation deficit. This arrangement is intended to limit the Company’s exposure to losses in the event of a counterparty default. The Company is required to pledge assets under a bi-lateral margin arrangement, including either cash or Agency RMBS, as collateral for its interest rate swaps, futures contracts and TBAs, whose collateral requirements vary by counterparty and change over time based on the market value, notional amount, and remaining term of the agreement. In the event the Company is unable to meet a margin call under one of its agreements, thereby causing an event of default or triggering an early termination event under one of its agreements, the counterparty to such agreement may have the option to terminate all of such counterparty’s outstanding transactions with the Company. In addition, under this scenario, any close-out amount due to the counterparty upon termination of the counterparty’s transactions would be immediately payable by the Company pursuant to the applicable agreement. The Company believes it was in compliance with all margin requirements under its agreements as of June 30, 2016 and December 31, 2015 . The Company had $10.6 million and $6.3 million of restricted cash related to margin posted for its agreements as of June 30, 2016 and December 31, 2015 , respectively. The restricted cash held by third parties is included in receivables and other assets in the accompanying condensed consolidated balance sheets. |
Financing Arrangements, Portfol
Financing Arrangements, Portfolio Investments | 6 Months Ended |
Jun. 30, 2016 | |
Portfolio Investments | |
Financial Instruments Owned and Pledged as Collateral [Line Items] | |
Financing Arrangements, Portfolio Investments | Financing Arrangements, Portfolio Investments The Company finances its portfolio investments with a combination of repurchase agreements and, until January 2016, Federal Home Loan Bank advances. The Company has entered into repurchase agreements with third party financial institutions and the Company’s wholly owned subsidiary, GLIH, as a member of the FHLBI, had access to a variety of products and services offered by the FHLBI, including secured advances, until January 2016 when the regulator of the FHLB system amended regulations that requires GLIH to terminate its FHLB-membership by early 2017. These financing arrangements are short-term borrowings that bear interest rates typically based on a spread to LIBOR, and are secured by the securities which they finance. At June 30, 2016 , the Company had repurchase agreements with an outstanding balance of $618.1 million and a weighted average interest rate of 0.97% . At December 31, 2015 , the Company had repurchase agreements and FHLBI advances with an outstanding balance of $577.4 million and a weighted average interest rate of 0.71% . The following table presents detailed information about the Company’s borrowings under financing arrangements and associated assets pledged as collateral at June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 December 31, 2015 Outstanding Financing Arrangements Fair Value of Collateral Pledged Amortized Cost of Collateral Pledged Outstanding Financing Arrangements (1) Fair Value of Collateral Pledged Amortized Cost of Collateral Pledged Agency ARMs $ 119,830 $ 126,497 $ 126,469 $ 227,609 $ 141,585 $ 143,754 Agency Fixed Rate 329,740 347,449 351,450 261,644 374,691 386,853 Agency IOs/U.S. Treasury Securities 76,028 104,335 117,310 88,160 123,407 139,218 Non Agency/CMBS 92,452 122,536 121,985 — — — Balance at end of the period $ 618,050 $ 700,817 $ 717,214 $ 577,413 $ 639,683 $ 669,825 (1) Includes FHLBI advances amounting to $121.0 million as of December 31, 2015. As of June 30, 2016 and December 31, 2015 , the average days to maturity for financing arrangements were 20 days and 27 days, respectively. The Company’s accrued interest payable on outstanding financing arrangements, including FHLBI advances, at June 30, 2016 and December 31, 2015 amounts to $0.2 million and $0.3 million , respectively, and is included in accrued expenses and other liabilities on the Company’s condensed consolidated balance sheets. The following table presents contractual maturity information about the Company’s outstanding financing arrangements, at June 30, 2016 and December 31, 2015 (dollar amounts in thousands): Contractual Maturity June 30, 2016 December 31, 2015 Within 30 days $ 566,447 $ 468,402 Over 30 days to 90 days 51,603 85,423 Over 90 days — 23,588 Total $ 618,050 $ 577,413 As of June 30, 2016 , the outstanding balance under our financing arrangements was funded at an advance rate of 89.9% that implies an average haircut of 10.1% . The weighted average “haircut” related to our repurchase agreement financing for our Agency RMBS (excluding Agency IOs), Non Agency RMBS, CMBS and Agency IOs was approximately 5% , 20% , 25% and 25% , respectively. In the event we are unable to obtain sufficient short-term financing through existing financings arrangements, or our lenders start to require additional collateral, we may have to liquidate our investment securities at a disadvantageous time, which could result in losses. Any losses resulting from the disposition of our investment securities in this manner could have a material adverse effect on our operating results and net profitability. At June 30, 2016 and December 31, 2015 , the Company had financing arrangements with 6 and 6 counterparties, respectively. As of June 30, 2016 and December 31, 2015 , we had no counterparties where the amount at risk was in excess of 5% of the Company's stockholders’ equity. The amount at risk is defined as the fair value of securities pledged as collateral to the financing arrangement in excess of the financing arrangement liability. As of June 30, 2016 , our available liquid assets include unrestricted cash and cash equivalents, overnight deposits and unencumbered securities we believe may be posted as margin. The Company had $49.9 million in cash and cash equivalents, $39.7 million in overnight deposits in our Agency IO portfolio included in restricted cash and $161.0 million in unencumbered investment securities to meet additional haircuts or market valuation requirements. The unencumbered securities that we believe may be posted as margin as of June 30, 2016 included $41.0 million of Agency RMBS, $112.4 million of CMBS and $7.6 million of non-agency RMBS and other investment securities. The cash and unencumbered securities, which collectively represent 40.5% of our financing arrangements, are liquid and could be monetized to pay down or collateralize a liability immediately. |
Financing Arrangements, Residen
Financing Arrangements, Residential Mortgage Loans | 6 Months Ended |
Jun. 30, 2016 | |
Distressed Residential Mortgage Loans | |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |
Financing Arrangements, Residential Mortgage Loans | Financing Arrangements, Residential Mortgage Loans The Company has a master repurchase agreement with Deutsche Bank AG, Cayman Islands Branch in an aggregate principal amount of up to $250.0 million , to fund future purchases of distressed residential mortgage loans. The outstanding balance on this master repurchase agreement as of June 30, 2016 and December 31, 2015 amounts to approximately $176.2 million and $214.5 million , respectively, bearing interest at one month LIBOR plus 2.50% ( 2.95% and 2.92% at June 30, 2016 and December 31, 2015 , respectively) and expires on December 15, 2016 . In addition, on November 25, 2015 , the Company entered into a master repurchase agreement with Deutsche Bank AG, Cayman Islands Branch in an aggregate principal amount of up to $100.0 million , to fund the future purchase of residential mortgage loans. The outstanding balance on the master repurchase agreement will bear interest at one-month LIBOR plus 4.0% and expires on May 25, 2017 . There was no outstanding balance on this master repurchase agreement as of June 30, 2016 and December 31, 2015 . During the term of the master repurchase agreements, proceeds from the residential mortgage loans, including the Company's distressed residential mortgage loans, will be applied to pay any price differential and to reduce the aggregate repurchase price of the collateral. The financings under the master repurchase agreements are subject to margin calls to the extent the market value of the residential mortgage loans falls below specified levels and repurchase may be accelerated upon an event of default under the master repurchase agreements. The master repurchase agreements contain various covenants, including among other things, to maintain certain levels of net worth, liquidity and leverage ratios. The Company is in compliance with such covenants as of August 5, 2016 . |
Residential Collateralized Debt
Residential Collateralized Debt Obligations | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Residential Collateralized Debt Obligations | Residential Collateralized Debt Obligations The Company’s Residential CDOs, which are recorded as liabilities on the Company’s condensed consolidated balance sheets, are secured by ARM loans pledged as collateral, which are recorded as assets of the Company. As of June 30, 2016 and December 31, 2015 , the Company had Residential CDOs outstanding of $102.6 million and $116.7 million , respectively. As of June 30, 2016 and December 31, 2015 , the current weighted average interest rate on these Residential CDOs was 0.84% and 0.80% , respectively. The Residential CDOs are collateralized by ARM loans with a principal balance of $109.2 million and $122.5 million at June 30, 2016 and December 31, 2015 , respectively. The Company retained the owner trust certificates, or residual interest, for three securitizations, and, as of June 30, 2016 and December 31, 2015 , had a net investment in the residential securitization trusts of $4.4 million and $4.4 million , respectively. |
Subordinated Debentures
Subordinated Debentures | 6 Months Ended |
Jun. 30, 2016 | |
Subordinated Borrowings [Abstract] | |
Subordinated Debentures | Subordinated Debentures Subordinated debentures are trust preferred securities that are fully guaranteed by the Company with respect to distributions and amounts payable upon liquidation, redemption or repayment. The following table summarizes the key details of the Company’s subordinated debentures as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): NYM Preferred Trust I NYM Preferred Trust II Principal value of trust preferred securities $ 25,000 $ 20,000 Interest Rate Three month LIBOR plus 3.75%, resetting quarterly Three month LIBOR plus 3.95%, resetting quarterly Scheduled maturity March 30, 2035 October 30, 2035 As of August 5, 2016 , the Company has not been notified, and is not aware, of any event of default under the covenants for the subordinated debentures. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Loans Sold to Third Parties – The Company sold its mortgage lending business in March 2007. In the normal course of business, the Company is obligated to repurchase loans based on violations of representations and warranties in the loan sale agreements. The Company did not repurchase any loans during the six months ended June 30, 2016 . Outstanding Litigation – The Company is at times subject to various legal proceedings arising in the ordinary course of business. As of June 30, 2016 , the Company does not believe that any of its current legal proceedings, individually or in the aggregate, will have a material adverse effect on the Company’s operations, financial condition or cash flows. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company has established and documented processes for determining fair values. Fair value is based upon quoted market prices, where available. If listed prices or quotes are not available, then fair value is based upon internally developed models that primarily use inputs that are market-based or independently-sourced market parameters, including interest rate yield curves. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of valuation hierarchy are defined as follows: Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement. The following describes the valuation methodologies used for the Company’s financial instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy. a. Investment Securities Available for Sale – Fair value for the investment securities in our portfolio, except the CMBS held in securitization trusts, are valued using a third-party pricing service or are based on quoted prices provided by dealers who make markets in similar financial instruments. The dealers will incorporate common market pricing methods, including a spread measurement to the Treasury curve or interest rate swap curve as well as underlying characteristics of the particular security including coupon, periodic and life caps, collateral type, rate reset period and seasoning or age of the security. If quoted prices for a security are not reasonably available from a dealer, the security will be re-classified as a Level 3 security and, as a result, management will determine the fair value based on characteristics of the security that the Company receives from the issuer and available market information. Management reviews all prices used in determining fair value to ensure they represent current market conditions. This review includes surveying similar market transactions, comparisons to interest pricing models as well as offerings of like securities by dealers. The Company's investment securities, except the CMBS held in securitization trusts, are valued based upon readily observable market parameters and are classified as Level 1 or 2 fair values. The Company’s CMBS held in securitization trusts are comprised of securities for which there are not substantially similar securities that trade frequently. The Company classifies these securities as Level 3 fair values. Fair value of the Company’s CMBS investments held in securitization trusts is based on an internal valuation model that considers expected cash flows from the underlying loans and yields required by market participants. The significant unobservable inputs used in the measurement of these investments are projected losses of certain identified loans within the pool of loans and a discount rate. The discount rate used in determining fair value incorporates default rate, loss severity and current market interest rates. The discount rate ranges from 4.5% to 10.5% . Significant increases or decreases in these inputs would result in a significantly lower or higher fair value measurement. b. Multi - Family Loans Held in Securitization Trusts – Multi-family loans held in securitization trusts are carried at fair value as a result of a fair value election and classified as Level 3 fair values. Effective January 1, 2016, the Company determines the fair value of multi-family loans held in securitization trusts based on the fair value of its Multi-Family CDOs and its retained interests from these securitizations (eliminated in consolidation in accordance with U.S. GAAP), as the fair value of these instruments is more observable. Prior to January 1, 2016, fair value was based on an internal valuation model that considers expected cash flows from the underlying loans and yields required by market participants. The significant unobservable inputs used in the measurement of these investments are discount rates. The discount rate used in determining fair value incorporates default rate, loss severity and current market interest rates. c. Derivative Instruments – The fair value of interest rate swaps, swaptions, options and TBAs are based on dealer quotes. The fair value of future contracts are based on exchange-traded prices. The Company’s derivatives are classified as Level 1 or Level 2 fair values. d. Multi-Family CDOs – Multi-Family CDOs are recorded at fair value and classified as Level 3 fair values. The fair value of Multi-Family CDOs is determined using a third party pricing service or are based on quoted prices provided by dealers who make markets in similar financial instruments. The dealers will consider contractual cash payments and yields expected by market participants. Dealers also incorporate common market pricing methods, including a spread measurement to the Treasury curve or interest rate swap curve as well as underlying characteristics of the particular security including coupon, periodic and life caps, collateral type, rate reset period and seasoning or age of the security. The Company’s Multi-Family CDOs are classified as Level 3 fair values. e. Investment in Unconsolidated Entities – Fair value for investments in unconsolidated entities is determined based on a valuation model using assumptions for the timing and amount of expected future cash flow for income and realization events for the underlying assets in the unconsolidated entities and a discount rate. This fair value measurement is generally based on unobservable inputs and, as such, is classified as Level 3 in the fair value hierarchy. Any changes to the valuation methodology are reviewed by management to ensure the changes are appropriate. As markets and products develop and the pricing for certain products becomes more transparent, the Company continues to refine its valuation methodologies. The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The Company uses inputs that are current as of each reporting date, which may include periods of market dislocation, during which time price transparency may be reduced. This condition could cause the Company’s financial instruments to be reclassified from Level 2 to Level 3 in future periods. The following table presents the Company’s financial instruments measured at fair value on a recurring basis as of June 30, 2016 and December 31, 2015 , respectively, on the Company’s condensed consolidated balance sheets (dollar amounts in thousands): Measured at Fair Value on a Recurring Basis at June 30, 2016 December 31, 2015 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets carried at fair value Investment securities available for sale: Agency RMBS $ — $ 613,304 $ — $ 613,304 $ — $ 713,116 $ — $ 713,116 Non-Agency RMBS — 110,371 — 110,371 — 1,567 — 1,567 U.S. Treasury Securities 7,997 — — 7,997 10,037 — — 10,037 CMBS — 22,546 42,271 64,817 — — 40,734 40,734 Multi-family loans held in securitization trusts — — 7,282,145 7,282,145 — — 7,105,336 7,105,336 Derivative assets: TBA Securities — 290,318 — 290,318 — 226,929 — 226,929 Options on U.S. Treasury futures 27 — — 27 15 — — 15 U.S. Treasury futures 1,002 — — 1,002 — — — — Interest rate swap futures — — — — 706 — — 706 Interest rate swaps — — — — — 304 — 304 Swaptions — 333 — 333 — 821 — 821 Investment in unconsolidated entities — — 63,055 63,055 — — 67,571 67,571 Total $ 9,026 $ 1,036,872 $ 7,387,471 $ 8,433,369 $ 10,758 $ 942,737 $ 7,213,641 $ 8,167,136 Liabilities carried at fair value Multi-family collateralized debt obligations $ — $ — $ 6,981,813 $ 6,981,813 $ — $ — $ 6,818,901 $ 6,818,901 Derivative liabilities: Eurodollar futures 4,572 — — 4,572 1,242 — — 1,242 Interest rate swaps 1,107 — 1,107 — 258 — 258 Interest rate swap futures 759 — — 759 — — — — Total $ 5,331 $ 1,107 $ 6,981,813 $ 6,988,251 $ 1,242 $ 258 $ 6,818,901 $ 6,820,401 The following table details changes in valuation for the Level 3 assets for the six months ended June 30, 2016 and 2015 , respectively (amounts in thousands): Level 3 Assets: Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 7,213,641 $ 8,442,604 Total gains/(losses) (realized/unrealized) Included in earnings (1) 240,755 (12,863 ) Included in other comprehensive income 124 422 Sales (2) — (1,073,029 ) Transfers in (3) 52,176 — Transfers out (4) (56,756 ) — Contributions 1,500 12,701 Paydowns (58,993 ) (38,475 ) Distributions (4,976 ) (382 ) Balance at the end of period $ 7,387,471 $ 7,330,978 (1) Amounts included in interest income from multi-family loans held in securitization trusts, unrealized gain on multi-family loans and debt held in securitization trusts, realized gain (loss) on investment securities and related hedges, gain on de-consolidation, and other income. (2) In February 2015, the Company sold a first loss PO security from one of the Company’s Consolidated K-Series securitizations obtaining total proceeds of approximately $44.3 million and realizing a gain of approximately $1.5 million . The sale resulted in a de-consolidation of $1.1 billion in multi-family loans held in a securitization trust and $1.0 billion in Multi-Family CDOs. (3) Transfers into Level 3 are investments in unconsolidated entities held by RiverBanc and RBMI for which the Company accounts under the equity method of accounting with a fair value election. These transfers in are a result of the Company’s acquisition of the outstanding membership interests in RiverBanc and RBMI that were not previously owned by the Company on May 16, 2016, which resulted in consolidation of these entities into the Company's financial statements. ( see Note 19 ). (4) Transfers out of Level 3 are the Company’s previously held membership interests in RBMI and RBDHC that were accounted for under the equity method of accounting with a fair value election. These transfers out are a result of the Company’s acquisition of the outstanding membership interests in RBMI and RBDHC that were not previously owned by the Company on May 16, 2016, which resulted in consolidation of these entities into the Company's financial statements. ( see Note 19 ). The following table details changes in valuation for the Level 3 liabilities for the six months ended June 30, 2016 and 2015 , respectively (amounts in thousands): Level 3 Liabilities: Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 6,818,901 $ 8,048,053 Total gains/(losses) (realized/unrealized) Included in earnings (1) 221,899 (46,999 ) Sales (2) — (1,031,268 ) Paydowns (58,987 ) (37,694 ) Balance at the end of period $ 6,981,813 $ 6,932,092 (1) Amounts included in interest expense on Multi-Family CDOs, realized gain (loss) on investment securities and related hedges and unrealized gain on multi-family loans and debt held in securitization trusts. (2) In February 2015, the Company sold a first loss PO security from one of the Company’s Consolidated K-Series securitizations obtaining total proceeds of approximately $44.3 million and realizing a gain of approximately $1.5 million . The sale resulted in a de-consolidation of $1.1 billion in multi-family loans held in a securitization trust and $1.0 billion in Multi-Family CDOs. The following table details the changes in unrealized gains (losses) included in earnings for our Level 3 Multi-family loans and debt held in securitization trusts for the three and six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Change in unrealized gains (losses)– assets $ 65,763 $ (136,701 ) $ 255,656 $ (305 ) Change in unrealized (losses) gains – liabilities (64,979 ) 142,119 (254,054 ) 19,351 Net change in unrealized gains included in earnings for assets and liabilities $ 784 $ 5,418 $ 1,602 $ 19,046 The following table presents assets measured at fair value on a non-recurring basis as of June 30, 2016 and December 31, 2015 , respectively, on the condensed consolidated balance sheets (dollar amounts in thousands): Assets Measured at Fair Value on a Non-Recurring Basis at June 30, 2016 December 31, 2015 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Residential mortgage loans held in securitization trusts – impaired loans (net) $ — $ — $ 9,044 $ 9,044 $ — $ — $ 8,976 $ 8,976 Real estate owned held in residential securitization trusts — — 72 72 — — 411 411 The following table presents gains (losses) incurred for assets measured at fair value on a non-recurring basis for the three and six months ended June 30, 2016 and 2015 , respectively, on the Company’s condensed consolidated statements of operations (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Residential mortgage loans held in securitization trusts – impaired loans (net) $ 163 $ (345 ) $ 432 $ (656 ) Real estate owned held in residential securitization trusts (225 ) — (23 ) 26 Residential Mortgage Loans Held in Securitization Trusts – Impaired Loans (net) – Impaired residential mortgage loans held in securitization trusts are recorded at amortized cost less specific loan loss reserves. Impaired loan value is based on management’s estimate of the net realizable value taking into consideration local market conditions of the property, updated appraisal values of the property and estimated expenses required to remediate the impaired loan. Real Estate Owned Held in Residential Securitization Trusts – Real estate owned held in the residential securitization trusts are recorded at net realizable value. Any subsequent adjustment will result in the reduction in carrying value with the corresponding amount charged to earnings. Net realizable value is based on an estimate of disposal taking into consideration local market conditions of the property, updated appraisal values of the property and estimated expenses required to sell the property. The following table presents the carrying value and estimated fair value of the Company’s financial instruments at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Fair Value Hierarchy Level Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Financial Assets: Cash and cash equivalents Level 1 $ 49,941 $ 49,941 $ 61,959 $ 61,959 Investment securities available for sale (1) Level 1, 2 or 3 796,489 796,489 765,454 765,454 Residential mortgage loans held in securitization trusts (net) Level 3 106,173 93,314 119,921 109,120 Distressed residential mortgage loans (net) (2) Level 3 543,361 544,858 558,989 564,310 Multi-family loans held in securitization trusts Level 3 7,282,145 7,282,145 7,105,336 7,105,336 Derivative assets Level 1 or 2 291,680 291,680 228,775 228,775 Mortgage loans held for sale (net) (3) Level 3 5,283 5,328 5,471 5,557 Mortgage loans held for investment (3) Level 3 10,391 10,531 2,706 2,846 Mezzanine loan and preferred equity investments (4) Level 3 75,300 76,004 44,151 44,540 Investment in unconsolidated entities (5) Level 3 73,839 74,304 87,662 87,558 Financial Liabilities: Financing arrangements, portfolio investments Level 2 $ 618,050 $ 618,050 $ 577,413 $ 577,413 Financing arrangements, residential mortgage loans Level 2 174,798 174,798 212,155 212,155 Residential collateralized debt obligations Level 3 102,597 92,522 116,710 105,606 Multi-family collateralized debt obligations Level 3 6,981,813 6,981,813 6,818,901 6,818,901 Securitized debt Level 3 244,016 252,252 116,541 123,776 Derivative liabilities Level 1 or 2 6,438 6,438 1,500 1,500 Payable for securities purchased Level 1 286,452 286,452 227,969 227,969 Subordinated debentures Level 3 45,000 44,081 45,000 42,731 (1) Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively. (2) Includes distressed residential mortgage loans held in securitization trusts with a carrying value amounting to approximately $225.4 million and $114.2 million at June 30, 2016 and December 31, 2015 , respectively, and distressed residential mortgage loans with a carrying value amounting to approximately $318.0 million and $444.8 million at June 30, 2016 and December 31, 2015 , respectively. (3) Included in receivables and other assets in the accompanying condensed consolidated balance sheets. (4) Includes mezzanine loan and preferred equity investments accounted for as loans ( see Note 2 ). (5) Includes investments in unconsolidated entities accounted for under the fair value option with a carrying value of $63.1 million and $67.6 million at June 30, 2016 and December 31, 2015 , respectively. In addition to the methodology to determine the fair value of the Company’s financial assets and liabilities reported at fair value on a recurring basis and non-recurring basis, as previously described, the following methods and assumptions were used by the Company in arriving at the fair value of the Company’s other financial instruments in the table immediately above: a. Cash and cash equivalents – Estimated fair value approximates the carrying value of such assets. b. Residential mortgage loans held in securitization trusts (net) – Residential mortgage loans held in the securitization trusts are recorded at amortized cost. Fair value is based on an internal valuation model that considers the aggregated characteristics of groups of loans such as, but not limited to, collateral type, index, interest rate, margin, length of fixed-rate period, life cap, periodic cap, underwriting standards, age and credit estimated using the estimated market prices for similar types of loans. c. Distressed residential mortgage loans (net) – Fair value is estimated using pricing models taking into consideration current interest rates, loan amount, payment status and property type, and forecasts of future interest rates, home prices and property values, prepayment speeds, default, loss severities, and actual purchases and sales of similar loans. d. Receivable for securities sold – Estimated fair value approximates the carrying value of such assets. e. Mortgage loans held for sale (net) – The fair value of mortgage loans held for sale (net) are estimated by the Company based on the price that would be received if the loans were sold as whole loans taking into consideration the aggregated characteristics of the loans such as, but not limited to, collateral type, index, interest rate, margin, length of fixed interest rate period, life time cap, periodic cap, underwriting standards, age and credit. f. Mezzanine loan and preferred equity investments – Estimated fair value is determined by both market comparable pricing and discounted cash flows. The discounted cash flows are based on the underlying contractual cash flows and estimated changes in market yields. The fair value also reflects consideration of changes in credit risk since the origination or time of initial investment. g. Financing arrangements – The fair value of these financing arrangements approximates cost as they are short term in nature. h. Residential collateralized debt obligations – The fair value of these CDOs is based on discounted cash flows as well as market pricing on comparable obligations. i. Securitized debt – The fair value of securitized debt is based on discounted cash flows using management’s estimate for market yields. j. Payable for securities purchased – Estimated fair value approximates the carrying value of such liabilities. k. Subordinated debentures – The fair value of these subordinated debentures is based on discounted cash flows using management’s estimate for market yields. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity (a) Dividends on Preferred Stock The Company had 200,000,000 authorized shares of preferred stock, par value $0.01 per share, with 6,600,000 shares issued and outstanding as of June 30, 2016 and December 31, 2015 . On June 4, 2013, the Company issued 3,000,000 shares of 7.75% Series B Cumulative Redeemable Preferred Stock (“Series B Preferred Stock”), with a par value of $0.01 per share and a liquidation preference of $25 per share, in an underwritten public offering, for net proceeds of approximately $72.4 million , after deducting underwriting discounts and offering expenses. As of June 30, 2016 and December 31, 2015 , there were 6,000,000 shares of Series B Preferred Stock authorized. The Series B Preferred Stock is entitled to receive a dividend at a rate of 7.75% per year on the $25 liquidation preference and is senior to the common stock with respect to dividends and distribution of assets upon liquidation, dissolution or winding up. On April 22, 2015, the Company issued 3,600,000 shares of 7.875% Series C Cumulative Redeemable Preferred Stock (“Series C Preferred Stock”), with a par value of $0.01 per share and a liquidation preference of $25 per share, in an underwritten public offering, for net proceeds of approximately $86.9 million , after deducting underwriting discounts and offering expenses. As of June 30, 2016 and December 31, 2015 , there were 4,140,000 shares of Series C Preferred Stock authorized. The Series C Preferred Stock is entitled to receive a dividend at a rate of 7.875% per year on the $25 liquidation preference and is senior to the common stock with respect to dividends and distribution of assets upon liquidation, dissolution or winding up. The Series B Preferred Stock and Series C Preferred Stock generally do not have any voting rights, subject to an exception in the event the Company fails to pay dividends on such stock for six or more quarterly periods (whether or not consecutive). Under such circumstances, holders of the Series B Preferred Stock and Series C Preferred Stock, voting together as a single class with the holders of all other classes or series of our preferred stock upon which like voting rights have been conferred and are exercisable and which are entitled to vote as a class with the Series B Preferred Stock and Series C Preferred Stock, will be entitled to vote to elect two additional directors to the Company’s Board of Directors (the “Board”) until all unpaid dividends have been paid or declared and set apart for payment. In addition, certain material and adverse changes to the terms of the Series B Preferred Stock and Series C Preferred Stock cannot be made without the affirmative vote of holders of at least two-thirds of the outstanding shares of Series B Preferred Stock and Series C Preferred Stock. Neither the Series B Preferred Stock and Series C Preferred Stock are redeemable by the Company prior to June 4, 2018, in the case of the Series B Preferred Stock, and April 22, 2020, in the case of the Series C Preferred Stock, except under circumstances intended to preserve the Company’s qualification as a REIT and except upon the occurrence of a Change of Control (as defined in the Articles Supplementary designating the Series B Preferred Stock and Series C Preferred Stock, respectively). On and after June 4, 2018 and April 22, 2020, the Company may, at its option, redeem the Series B Preferred Stock and Series C Preferred Stock, respectively, in whole or in part, at any time or from time to time, for cash at a redemption price equal to $25.00 per share, plus any accumulated and unpaid dividends. In addition, upon the occurrence of a Change of Control, the Company may, at its option, redeem the Series B Preferred Stock and Series C Preferred Stock, in whole or in part, within 120 days after the first date, on which such Change of Control occurred, for cash at a redemption price of $25.00 per share, plus any accumulated and unpaid dividends. Each of the Series B Preferred Stock and Series C Preferred Stock has no stated maturity, is not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless repurchased or redeemed by the Company or converted into the Company’s common stock in connection with a Change of Control. Upon the occurrence of a Change of Control, each holder of Series B Preferred Stock and Series C Preferred Stock will have the right (unless the Company has exercised its right to redeem the Series B Preferred Stock or Series C Preferred Stock, respectively) to convert some or all of the Series B Preferred Stock or Series C Preferred Stock held by such holder into a number of shares of our common stock per share of Series B Preferred Stock or Series C Preferred Stock determined by a formula, in each case, on the terms and subject to the conditions described in the applicable Articles Supplementary for such series. From the time of original issuance of each of the Series B Preferred Stock and the Series C Preferred Stock through June 30, 2016 , the Company has declared and paid all required quarterly dividends on such series of stock. The following table presents the relevant dates with respect to quarterly cash dividends on the Series B Preferred Stock from January 1, 2015 through June 30, 2016 and cash dividends on Series C Preferred Stock from issuance through June 30, 2016 : Series B Preferred Stock Series C Preferred Stock Declaration Date Record Date Payment Date Cash Dividend Per Share Declaration Date Record Date Payment Date Cash Dividend Per Share June 16, 2016 July 1, 2016 July 15, 2016 $ 0.484375 June 16, 2016 July 1, 2016 July 15, 2016 $ 0.4921875 March 18, 2016 April 1, 2016 April 15, 2016 0.484375 March 18, 2016 April 1, 2016 April 15, 2016 0.4921875 December 16, 2015 January 1, 2016 January 15, 2016 0.484375 December 16, 2015 January 1, 2016 January 15, 2016 0.4921875 September 18, 2015 October 1, 2015 October 15, 2015 0.484375 September 18, 2015 October 1, 2015 October 15, 2015 0.4921875 June 18, 2015 July 1, 2015 July 15, 2015 0.484375 June 18, 2015 July 1, 2015 July 15, 2015 0.4539100 (1) March 18, 2015 April 1, 2015 April 15, 2015 0.484375 — — — — (1) Cash dividend for the partial quarterly period that began on April 22, 2015 and ended on July 14, 2015. (b) Dividends on Common Stock The following table presents cash dividends declared by the Company on its common stock with respect to each of the quarterly periods commencing January 1, 2015 and ended June 30, 2016 : Period Declaration Date Record Date Payment Date Cash Dividend Per Share Second Quarter 2016 June 16, 2016 June 27, 2016 July 25, 2016 $ 0.24 First Quarter 2016 March 18, 2016 March 28, 2016 April 25, 2016 0.24 Fourth Quarter 2015 December 16, 2015 December 28, 2015 January 25, 2016 0.24 Third Quarter 2015 September 18, 2015 September 28, 2015 October 26, 2015 0.24 Second Quarter 2015 June 18, 2015 June 29, 2015 July 27, 2015 0.27 First Quarter 2015 March 18, 2015 March 30, 2015 April 27, 2015 0.27 (c) Public Offering of Common Stock There were no underwritten public offerings of common stock during the three and six months ended June 30, 2016 . (d) Equity Distribution Agreements On March 20, 2015, the Company entered into separate equity distribution agreements (collectively, the “Equity Distribution Agreements”) with each of JMP Securities LLC (“JMP”) and MLV & Co. LLC (“MLV”), each an “Agent” and collectively, the “Agents”, pursuant to which the Company may sell up to $75,000,000 of aggregate value of (i) shares of the Company’s common stock, par value $0.01 per and (ii) shares of the Company’s Series B Preferred Stock, from time to time through the Agents. The Company has no obligation to sell any of the shares under the Equity Distribution Agreements and may at any time suspend solicitations and offers under the Equity Distribution Agreements. During the six months ended June 30, 2015 , the Company issued 1,375,682 shares of its common stock under the Equity Distribution Agreements, at an average sales price of $8.04 , resulting in total net proceeds to the Company of $10.8 million after deducting the placement fees. During the three and six months ended June 30, 2016 , the Company issued no shares under the Equity Distribution Agreements. As of June 30, 2016 , approximately $52.9 million of securities remains available for issuance under the Equity Distribution Agreements. On March 20, 2015, in connection with the Company’s execution of the Equity Distribution Agreements described above, the Company delivered to JMP a notice of termination of the Equity Distribution Agreement dated June 11, 2012 (the “Prior Equity Distribution Agreement”), which termination became effective March 23, 2015. The Prior Equity Distribution Agreement provided for the sale by the Company of common stock having a maximum aggregate value of up to $25,000,000 from time to time through JMP, as the Company’s agent. During the six months ended June 30, 2015 , the Company issued 1,326,676 shares under the Prior Equity Distribution Agreement, at an average sales price of $7.89 resulting in total net proceeds to the Company of $10.3 million , after deducting the placement fees. During the term of the Prior Equity Distribution Agreement, the Company sold a total of 2,153,989 shares of its common stock at an average price of $7.63 per share pursuant to the Prior Distribution Agreement, resulting in aggregate net proceeds to the Company of approximately $16.1 million . |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The Company calculates basic net income per share by dividing net income for the period by weighted-average shares of common stock outstanding for that period. Diluted net income per share takes into account the effect of dilutive instruments, such as convertible preferred stock, stock options and unvested restricted or performance stock, but uses the average share price for the period in determining the number of incremental shares that are to be added to the weighted-average number of shares outstanding. There were no dilutive instruments for the six months ended June 30, 2016 and 2015 . The following table presents the computation of basic and dilutive net income per share for the periods indicated (dollar amounts in thousands, except per share amounts): For the Three Months Ended For the Six Months Ended 2016 2015 2016 2015 Numerator : Net income attributable to Company's common stockholders– Basic $ 11,210 $ 21,544 $ 24,936 $ 43,634 Net income attributable to Company's common stockholders– Dilutive $ 11,210 $ 21,544 $ 24,936 $ 43,634 Denominator: Weighted average basic and diluted shares outstanding 109,489 109,252 109,445 107,380 EPS: Basic EPS $ 0.10 $ 0.20 $ 0.23 $ 0.41 Dilutive EPS $ 0.10 $ 0.20 $ 0.23 $ 0.41 |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Based Compensation | Stock Based Compensation Pursuant to the Company’s 2010 Stock Incentive Plan (the “2010 Plan”), as approved by the Company’s stockholders, eligible employees, officers and directors of the Company have the opportunity to acquire the Company's common stock through the award of common stock, restricted common stock, performance share awards and other equity awards under the 2010 Plan. The maximum number of shares that may be issued under the 2010 Plan is 1,190,000 . Of the common stock authorized at June 30, 2016 and December 31, 2015 , 331,077 shares and 551,609 shares, respectively, were reserved for issuance under the 2010 Plan. The Company’s non-employee directors have been issued 207,014 and 146,935 shares under the 2010 Plan as of June 30, 2016 and December 31, 2015 , respectively. The Company’s employees have been issued 562,280 and 401,827 restricted shares under the 2010 Plan as of June 30, 2016 and December 31, 2015 , respectively. At June 30, 2016 and December 31, 2015 , there were 319,058 and 280,457 shares of unvested restricted stock outstanding under the 2010 Plan. (a) Restricted Common Stock Awards During the three and six months ended June 30, 2016 , the Company recognized non-cash compensation expense on its restricted common stock awards of $0.2 million and $ 0.5 million , respectively. During the three and six months ended June 30, 2015 , the Company recognized non-cash compensation expense on its restricted common stock awards of $0.2 million and $0.4 million , respectively. Dividends are paid on all restricted common stock issued, whether those shares have vested or not. In general, non-vested restricted stock is forfeited upon the recipient's termination of employment. There were no forfeitures during the six months ended June 30, 2016 and 2015 . A summary of the activity of the Company's non-vested restricted stock under the 2010 Plan for the six months ended June 30, 2016 and 2015 , respectively, is presented below: 2016 2015 Number of Non-vested Restricted Shares Weighted Average Per Share Grant Date Fair Value (1) Number of Non-vested Restricted Shares Weighted Average Per Share Grant Date Fair Value (1) Non-vested shares at January 1 280,457 $ 7.63 162,171 $ 7.26 Granted 160,453 5.11 185,650 7.79 Vested (121,852 ) 7.54 (67,364 ) 7.18 Non-vested shares as of June 30 319,058 $ 6.40 280,457 $ 7.63 Weighted-average fair value of restricted stock granted during the period 160,453 $ 5.11 185,650 $ 7.79 (1) The grant date fair value of restricted stock awards is based on the closing market price of the Company’s common stock at the grant date. At June 30, 2016 and 2015 , the Company had unrecognized compensation expense of $1.7 million and $1.6 million , respectively, related to the non-vested shares of restricted common stock under the 2010 Plan. The unrecognized compensation expense at June 30, 2016 is expected to be recognized over a weighted average period of 2.1 years. The total fair value of restricted shares vested during the six months ended June 30, 2016 and 2015 was approximately $0.6 million and $0.5 million , respectively. The requisite service period for restricted shares at issuance is 3 years. (b) Performance Share Awards In May 2015, the Compensation Committee of the Board of Directors approved a performance share award (“PSA”) pursuant to the 2010 Plan to the Company’s Chairman, Chief Executive Officer and President. At the time of grant, the target number of shares of PSA granted consisted of 89,629 shares of common stock. The PSA had a grant date fair value of approximately $0.4 million . The PSA are awards under which the number of underlying shares of Company common stock that can be earned will generally range from 0% to 200% of the target number of shares, with the target number of shares increased to reflect the value of the reinvestment of any dividends declared on Company common stock during the vesting period. Vesting of these PSAs will occur at the end of three years based on three -year TSR, as follows: • If three -year TSR is less than 33%, then 0% of the PSAs will vest; • If three -year TSR is greater than or equal to 33% and the TSR is not in the bottom quartile of an identified peer group, then 100% of the PSAs will vest; • If three -year TSR is greater than or equal to 33% and the TSR is in the top quartile of an identified peer group, then 200% of the PSAs will vest; • If three -year TSR is greater than or equal to 33% and the TSR is in the bottom quartile of an identified peer group, then 50% of the PSAs will vest. TSR is defined, with respect to the Company and each member of the identified peer group, as applicable, as the average annual total shareholder return based on common stock price appreciation/depreciation during the applicable measurement period or until the date of a change of control, whichever first occurs, plus the value on the last day of the applicable measurement period or the date of a change of control of common shares if all cash dividends declared on a common share during such period were reinvested in additional common shares. The maximum number of shares which may be issued pursuant to the PSA is limited to 94,043 shares. In the event the PSA is earned at a level that would cause the Company to issue more than 94,043 shares, the dollar value of the PSA earned in excess of 94,043 shares will be paid in cash, subject to the terms of the 2010 Plan. The grant date fair values of PSAs were determined through a Monte-Carlo simulation of the Company’s common stock total shareholder return and the common stock total shareholder return of its peer companies to determine the TSR of the Company’s common stock relative to its peer companies over a future period of three years. For the 2015 PSA grant, the inputs used by the model to determine the fair value are (i) historical stock return volatilities of the Company and its peer companies over the most recent three year period, (ii) a risk free rate based on the three year U.S. Treasury rate on grant date, and (iii) historical pairwise stock return correlations between the Company and its peer companies over the most recent three year period. Compensation expenses related to PSAs were $31.7 thousand and $63.4 thousand for the three and six months ended June 30, 2016 . As of June 30, 2016 , there was $0.2 million of unrecognized compensation cost related to unvested PSAs. Under the terms of the PSA Agreement, the PSA is subject to the terms and conditions of the 2010 Plan and in the event of any conflict between the terms of the 2010 Plan and the PSA Agreement, the terms of the 2010 Plan govern. The 2010 Plan provides that the Compensation Committee may determine that the amount payable when an award of performance shares is earned may be settled in cash, by the issuance of shares, or a combination thereof. The 2010 Plan also provides that the maximum number of shares of common stock for which awards may be granted to any participant in any calendar year is 250,000 shares (the “Annual Share Limit”). In the event that PSA is earned at a level that would cause the grants to a participant exceed the Annual Share Limit, the dollar value of the PSA earned in excess of the limit will be paid in cash, subject to the terms of the 2010 Plan. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three and six months ended June 30, 2016 and June 30, 2015 , the Company qualified to be taxed as a REIT under the Code for U.S. federal income tax purposes. As long as the Company qualifies as a REIT, the Company generally will not be subject to U.S. federal income taxes on its taxable income to the extent it annually distributes at least 90% of its taxable income to stockholders and does not engage in prohibited transactions. Certain activities the Company performs may produce income that will not be qualifying income for REIT purposes. The Company has designated its TRSs to engage in these activities. The tables below reflect the taxes accrued at the TRS level and the tax attributes included in the consolidated financial statements. The income tax provision for the three and six months ended June 30, 2016 and June 30, 2015 is comprised of the following components (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Current income tax expense $ 2,183 $ 955 $ 2,255 $ 1,989 Deferred income tax expense (benefit) 183 223 302 (567 ) Total provision $ 2,366 $ 1,178 $ 2,557 $ 1,423 Deferred Tax Assets and Liabilities The major sources of temporary differences included in the deferred tax assets and their deferred tax effect as of June 30, 2016 and December 31, 2015 are as follows (dollar amounts in thousands): June 30, 2016 December 31, 2015 Deferred tax assets Net operating loss carryforward $ 2,268 $ 2,083 Net capital loss carryforward 754 2,029 GAAP/Tax basis differences 2,874 3,043 Total deferred tax assets (1) $ 5,896 $ 7,155 Deferred tax liabilities Deferred tax liabilities $ 1,702 $ 192 Total deferred tax liabilities (2) 1,702 192 Valuation allowance (1) (4,170 ) (6,457 ) Total net deferred tax asset $ 24 $ 506 (1) Included in receivables and other assets in the accompanying condensed consolidated balance sheets. (2) Included in accrued expenses and other liabilities in the accompanying condensed consolidated balance sheets. As of June 30, 2016 , the Company through wholly owned TRSs, had incurred net operating losses in the aggregate amount of approximately $4.9 million . The Company’s carryforward net operating losses will expire between 2033 and 2034 if they are not offset by future taxable income. Additionally, as of June 30, 2016 , the Company, through one of its wholly owned TRSs, also incurred approximately $1.6 million in capital losses. The Company’s carryforward capital losses will expire between 2018 and 2020 if they are not offset by future capital gains. At June 30, 2016 , the Company has recorded a valuation allowance against certain deferred tax assets as management does not believe that it is more likely than not that these deferred tax assets will be realized. The Company files income tax returns with the U.S. federal government and various state and local jurisdictions. The Company is no longer subject to tax examinations by tax authorities for years prior to 2012. The Company has assessed its tax positions for all open years, which includes 2012 to 2015 and concluded that there are no material uncertainties to be recognized. In addition, based on the Company’s evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in the Company’s financial statements. |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations On May 16, 2016 (the “Acquisition Date”), the Company acquired the outstanding common equity interests in RiverBanc, RBMI, and RBDHC (collectively, the “Acquirees”) that were not previously owned by the Company through the consummation of separate membership interest purchase agreements, thereby increasing the Company's ownership of each of these entities to 100% . The results of the Acquirees’ operations have been included in the condensed consolidated financial statements since the Acquisition Date. Prior to the Acquisition Date, the Company owned 20.0% , 67.19% and 62.5% of the outstanding common equity interests in RiverBanc, RBMI and RBDHC, respectively. RiverBanc is an investment management firm and registered investment adviser under the Investment Advisers Act of 1940 that was founded in 2010 and has sourced and managed direct and indirect investments in multifamily apartment properties on behalf of both public and private institutional investors, including the Company, RBMI and RBDHC. Prior to the completion of the RiverBanc acquisition, RiverBanc had served as an external manager of the Company pursuant to an investment management agreement, for which it received base management and incentive fees. In connection with the acquisition, the Company terminated its investment management agreement with RiverBanc on May 17, 2016. As of March 31, 2016, RiverBanc managed approximately $371.5 million of the Company’s capital. In acquiring a 100% ownership interest in RiverBanc, the Company has internalized the management of its multifamily investments. The Company expects to achieve certain synergies related to processes and personnel as a result of this internalization. In connection with the acquisitions, on the Acquisition Date, the Company named Kevin M. Donlon, the founder and Chief Executive Officer of RiverBanc, President of the Company and entered into an employment agreement with Mr. Donlon effective on the Acquisition Date. On June 16, 2016, the Company’s Board of Directors approved the appointment of Mr. Donlon as a director of the Company. Prior to the completion of the acquisitions described above, Donlon Family LLC beneficially owned 59.40% , 5.47% and 6.25% of the outstanding common equity interests in RiverBanc, RMI and RBDHC, respectively. Mr. Donlon beneficially owns 100% of Donlon Family LLC. The estimated Acquisition Date fair value of the consideration transferred totaled $53.5 million, which consisted of the following (dollar amounts in thousands): Cash (1) $ 29,053 Contingent consideration 3,800 Fair value of previously held membership interests 20,608 Total consideration transferred $ 53,461 (1) Includes $16.3 million paid to Donlon Family LLC. Prior to the Acquisition Date, the Company accounted for its previously held membership interests in the Acquirees as equity method investments, utilizing the fair value election for both RBMI and RBDHC. The Acquisition Date fair value of the Company's previously held membership interests in the Acquirees was $20.6 million and is included in the measurement of consideration transferred. In the current period, the Company recorded a net gain as a result of remeasuring its previously held membership interests in RiverBanc, RBMI, and RBDHC totaling $5.0 million. This net gain is included in other income on the Company's condensed consolidated statements of operations. The Company determined the estimated fair value of its previously held membership interests in RiverBanc using assumptions for the timing and amount of expected net future cash flow for the managed portfolio and a discount rate. The Company determined the estimated fair value of its previously held membership interests in RBMI and RBDHC using assumptions for the timing and amount of expected future cash flow for income and realization events for the underlying assets and a discount rate. The contingent consideration includes two components: • A cash holdback in the amount of $3.0 million to be released to Donlon Family LLC upon the purchase by Mr. Donlon or his affiliates of $3.0 million in Company shares on the open market within 90 days of the Acquisition Date. This cash holdback was paid to Donlon Family LLC on June 10, 2016 upon satisfaction of the conditions to the release of this holdback. • A severance holdback in the amount of $0.8 million to fund the aggregate amount of all severance compensation and severance benefits to be paid or provided to current or former RiverBanc employees as a result of the acquisition. The severance holdback was settled in cash and paid to a separated employee on June 30, 2016 with any holdback amount in excess of actual severance costs delivered to the sellers of RiverBanc within 60 days of the Acquisition Date. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed by the Company at the Acquisition Date (dollar amounts in thousands). The membership interest purchase agreement for the acquisition of RiverBanc included a post-closing working capital adjustment to be calculated and settled with the sellers of RiverBanc after the Acquisition Date. Additionally, the excess severance holdback amount described above will be settled with the sellers of RiverBanc after the Acquisition Date. The Company has also engaged a third party for valuations of certain intangible assets. Thus, the provisional measurements of assets and liabilities are subject to change. Cash $ 4,325 Investment in unconsolidated entities 52,176 Mezzanine loan and preferred equity investments 23,638 Real estate under development (1) 14,922 Receivables and other assets 911 Intangible assets (1) 3,910 Total identifiable assets acquired $ 99,882 Construction loan payable (2) $ 8,499 Accrued expenses and other liabilities 2,864 Total liabilities assumed $ 11,363 Preferred equity (3) $ 56,697 Net identifiable assets acquired $ 31,822 Goodwill (4) $ 24,782 Gain on bargain purchase (5) (65 ) Non-controlling interest (6) (3,078 ) Net assets acquired $ 53,461 (1) Included in receivables and other assets on the condensed consolidated balance sheets. (2) Construction loan payable to the Company is eliminated on the condensed consolidated balance sheets. (3) Includes $40.4 million of preferred equity owned by the Company that is eliminated on the condensed consolidated balance sheets. Remaining $16.3 million of preferred equity owned by third parties was redeemed in the period ended June 30, 2016. (4) Goodwill recognized in the acquisition of RiverBanc. (5) Gain on bargain purchase recognized in the acquisitions of RBMI and RBDHC. (6) Represents third-party ownership of KRVI membership interests ( see Note 7 ). The Company consolidates its investment in KRVI. The third-party ownership in KRVI is represented in the condensed consolidated financial statements and the pro forma net income attributable to the Company's common stockholders as non-controlling interests. The fair value of the non-controlling interests in KRVI is estimated to be $3.1 million. The fair value of the non-controlling interests in KRVI, a private company, was estimated using assumptions for the timing and amount of expected future cash flow for income and realization events for the underlying real estate. The $3.9 million of intangible assets relates to the RiverBanc acquisition and was recognized at estimated fair value on the Acquisition Date. Intangible assets include an acquired trade name, acquired technology, and employee non-compete agreements with useful lives ranging from 1 to 15 years. As noted earlier, the fair values of the acquired identifiable intangible assets are provisional pending final valuations for these assets. The $24.8 million of Goodwill recognized is attributable primarily to expected synergies and economies of scale from combining with RiverBanc and the assembled workforce of RiverBanc. For the Company’s ongoing evaluation of Goodwill for impairment in accordance with ASC 350, the Company’s multifamily investment portfolio (inclusive of RiverBanc) will be considered a reporting unit. As of June 30, 2016, there were no changes in the recognized amounts of Goodwill resulting from the acquisition of RiverBanc. As noted earlier, the goodwill recorded is provisional pending final valuations of assets and settlement of contingent consideration. The acquisition of both RBMI and RBDHC was negotiated directly with the sellers and the fair value of identifiable assets acquired and liabilities assumed exceed the fair value of the consideration transferred. Subsequently, the Company reassessed the identification and recognition of identifiable assets acquired and liabilities assumed, the Company’s previously held membership interests, and the consideration transferred and concluded that all items were recognized and that the valuation procedures and measurements were appropriate. Accordingly, the Company recorded a net gain on bargain purchase of $0.1 million that is included in other income on the Company’s condensed consolidated statements of operations. The amount of revenue of the Acquirees included in the Company’s condensed consolidated statements of operations from the Acquisition Date to the period ended June 30, 2016 is $1.0 million. The following represents the pro forma consolidated revenue and net income attributable to the Company's common stockholders as if the Acquirees had been included in the consolidated results of the Company for the six months ended June 30, 2016 and 2015, respectively (dollar amounts in thousands): For the Six Months Ended June 30, 2016 2015 Revenue $ 175,923 $ 207,011 Net income attributable to Company's common stockholders $ 21,897 $ 49,269 Basic pro forma income per share $ 0.20 $ 0.46 Diluted pro forma income per share $ 0.20 $ 0.46 These amounts have been calculated after applying the Company’s accounting policies and adjustments for consolidation and amortization that would have been charged assuming the estimated fair value adjustments to intangible assets had been applied on January 1, 2015. Material, nonrecurring pro forma adjustments directly attributable to the business combinations have been included in the pro forma consolidated revenue and net income attributable to the Company's common stockholders shown above as if the transaction occurred on January 1, 2015. These adjustments include a $5.0 million net gain on remeasurement of the Company's previously held membership interests, a $0.1 million net gain on bargain purchase, and the estimated related income tax expense of $2.1 million. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company terminated its management agreement with RiverBanc on May 17, 2016 as a result of the Company's acquisition of the remaining 80% membership interest in RiverBanc, which resulted in consolidation of RiverBanc into the Company's financial statements ( see Note 19 ). Prior to May 16, 2016, RiverBanc sourced and managed direct and indirect investments in multifamily properties on behalf of the Company pursuant to a management agreement entered into on April 5, 2011 and amended on March 13, 2013. The amended and restated management agreement had an effective date of January 1, 2013 and had an initial term that expired on December 31, 2015 and was subject to annual automatic one -year renewals (subject to any notice of termination). Prior to May 16, 2016 and as of December 31, 2015 , the Company owned a 20% membership interest in RiverBanc. For the three and six months ended June 30, 2016 , the Company recognized approximately $33.5 thousand and $0.1 million in equity income related to its investment in RiverBanc, respectively. For the three and six months ended June 30, 2015 , the Company recognized approximately $0.1 million and $0.8 million in equity income related to its investment in RiverBanc, respectively. For the three and six months ended June 30, 2016 , the Company expensed $0.6 million and 1.8 million in fees to RiverBanc, respectively. For the three and six months ended June 30, 2015 , the Company expensed $0.9 million and $4.8 million in fees to RiverBanc, respectively. As of December 31, 2015 , the Company had fees payable to RiverBanc of $1.7 million , respectively, included in accrued expenses and other liabilities. |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Basis of Presentation | Basis of Presentation – The accompanying condensed consolidated balance sheet as of December 31, 2015 has been derived from audited financial statements. The accompanying condensed consolidated balance sheet as of June 30, 2016 , the accompanying condensed consolidated statements of operations for the three and six months ended June 30, 2016 and 2015 , the accompanying condensed consolidated statements of comprehensive income for the three and six months ended June 30, 2016 and 2015 , the accompanying condensed consolidated statement of changes in stockholders’ equity for the six months ended June 30, 2016 and the accompanying condensed consolidated statements of cash flows for the six months ended June 30, 2016 and 2015 are unaudited. In our opinion, all adjustments (which include only normal recurring adjustments) necessary to present fairly the Company’s financial position, results of operations and cash flows have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with Article 10 of Regulation S-X and the instructions to Form 10-Q. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2015 , as filed with the U.S. Securities and Exchange Commission (“SEC”). The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the operating results for the full year. The accompanying condensed consolidated financial statements have been prepared on the accrual basis of accounting in accordance with GAAP. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management has made significant estimates in several areas, including valuation of its CMBS investments, multi-family loans held in securitization trusts and multi-family CDOs, as well as, income recognition on distressed residential mortgage loans purchased at a discount. Although the Company’s estimates contemplate current conditions and how it expects them to change in the future, it is reasonably possible that actual conditions could be different than anticipated in those estimates, which could materially impact the Company’s results of operations and its financial condition. Reclassifications – Certain prior period amounts have been reclassified in the condensed consolidated financial statements to conform to current period presentation. |
Principles of Consolidation and Variable Interest Entities | Principles of Consolidation and Variable Interest Entities – The accompanying condensed consolidated financial statements of the Company include the accounts of all its subsidiaries which are majority-owned, controlled by the Company or a variable interest entity ("VIE") where the Company is the primary beneficiary. All significant intercompany accounts and transactions have been eliminated in consolidation. A VIE is an entity that lacks one or more of the characteristics of a voting interest entity. A VIE is defined as an entity in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The Company consolidates a VIE when it is the primary beneficiary of such VIE, herein referred to as a "Consolidated VIE". As primary beneficiary, it has both the power to direct the activities that most significantly impact the economic performance of the VIE and a right to receive benefits or absorb losses of the entity that could be potentially significant to the VIE. The Company is required to reconsider its evaluation of whether to consolidate a VIE each reporting period, based upon changes in the facts and circumstances pertaining to the VIE. |
Investment Securities Available for Sale | Investment Securities Available for Sale – The Company's investment securities, where the fair value option has not been elected and which are reported at fair value with unrealized gains and losses reported in Other Comprehensive Income (“OCI”), include Agency RMBS, non-Agency RMBS and CMBS. The Company has elected the fair value option for its Agency IOs, U.S. Treasury securities, certain Agency ARMs and Agency fixed rate securities within the Agency IO portfolio, which measures unrealized gains and losses through earnings in the accompanying condensed consolidated statements of operations. The fair value option was elected for these investment securities to better match the accounting for these investment securities with the related derivative instruments within the Agency IO portfolio, which are not designated as hedging instruments for accounting purposes. The Company generally intends to hold its investment securities until maturity; however, from time to time, it may sell any of its securities as part of the overall management of its business. As a result, our investment securities are classified as available for sale securities. Realized gains and losses recorded on the sale of investment securities available for sale are based on the specific identification method and included in realized gain (loss) on investment securities and related hedges in the accompanying condensed consolidated statements of operations. Interest income on our investment securities available for sale is accrued based on the outstanding principal balance and their contractual terms. Purchase premiums or discounts on investment securities are amortized or accreted to interest income over the estimated life of the investment securities using the effective yield method. Adjustments to amortization are made for actual prepayment activity. Interest income on certain of our credit sensitive securities, such as our CMBS that were purchased at a discount to par value, is recognized based on the security’s effective interest rate. The effective interest rate on these securities is based on management’s estimate from each security of the projected cash flows, which are estimated based on assumptions related to fluctuations in interest rates, prepayment speeds and the timing and amount of credit losses. On at least a quarterly basis, management reviews and, if appropriate, adjusts its cash flow projections based on input and analysis received from external sources, internal models, and its judgment about interest rates, prepayment rates, the timing and amount of credit losses, and other factors. Changes in cash flows from those originally projected, or from those estimated at the last evaluation, may result in a prospective change in the yield/interest income recognized on these securities. A portion of the purchase discount on the Company’s first loss tranche PO multi-family CMBS is designated as non-accretable purchase discount or credit reserve, which partially mitigates the Company’s risk of loss on the mortgages collateralizing such multi-family CMBS, and is not expected to be accreted into interest income. The amount designated as a credit reserve may be adjusted over time, based on the actual performance of the security, its underlying collateral, actual and projected cash flow from such collateral, economic conditions and other factors. If the performance of a security with a credit reserve is more favorable than forecasted, a portion of the amount designated as credit reserve may be accreted into interest income over time. Conversely, if the performance of a security with a credit reserve is less favorable than forecasted, the amount designated as credit reserve may be increased, or impairment charges and writedowns of such securities to a new cost basis could be required. The Company accounts for debt securities that are of high credit quality (generally those rated AA or better by a Nationally Recognized Statistical Rating Organization, or NRSRO) at date of acquisition in accordance with ASC 320-10, Investments - Debt and Equity Securities ("ASC 320-10"). The Company accounts for debt securities that are not of high credit quality (i.e., those whose risk of loss is less than remote) or securities that can be contractually prepaid such that we would not recover our initial investment at the date of acquisition in accordance with ASC 325-40, Investments - Beneficial Interests in Securitized Financial Assets ("ASC 325-40"). The Company considers credit ratings, the underlying credit risk and other market factors in determining whether the debt securities are of high credit quality; however, securities rated lower than AA or an equivalent rating are not considered of high credit quality and are accounted for in accordance with ASC 325-40. If ratings are inconsistent among NRSROs, the Company uses the lower rating in determining whether the securities are of high credit quality. The Company assesses its impaired securities on at least a quarterly basis and designates such impairments as either “temporary” or “other-than-temporary” by applying the guidance prescribed in ASC 320-10. When the fair value of an investment security is less than its amortized cost as of the reporting balance sheet date, the security is considered impaired. If the Company intends to sell an impaired security, or it is more likely than not that it will be required to sell the impaired security before its anticipated recovery, then it must recognize an other-than-temporary impairment through earnings equal to the entire difference between the investment’s amortized cost and its fair value as of the balance sheet date. If the Company does not expect to sell an other-than-temporarily impaired security, only the portion of the other-than-temporary impairment related to credit losses is recognized through earnings with the remainder recognized as a component of other comprehensive income (loss) on the accompanying condensed consolidated balance sheets. Impairments recognized through other comprehensive income (loss) do not impact earnings. Following the recognition of an other-than-temporary impairment through earnings, a new cost basis is established for the security, which may not be adjusted for subsequent recoveries in fair value through earnings. However, other-than-temporary impairments recognized through earnings may be accreted back to the amortized cost basis of the security on a prospective basis through interest income. The determination as to whether an other-than-temporary impairment exists and, if so, the amount considered other-than-temporarily impaired is subjective, as such determinations are based on both factual and subjective information available at the time of assessment as well the Company’s estimates of the future performance and cash flow projections. As a result, the timing and amount of other-than-temporary impairments constitute material estimates that are susceptible to significant change. In determining the other-than temporary impairment related to credit losses for securities that are not of high credit quality, the Company compares the present value of the remaining cash flows expected to be collected at the prior reporting date or purchase date, whichever is most recent against the present value of the cash flows expected to be collected at the current financial reporting date. The Company considers information available about the past and expected future performance of underlying mortgage loans, including timing of expected future cash flows, prepayment rates, default rates, loss severities and delinquency rates. |
Residential Mortgage Loans Held in Securitization Trusts | Residential Mortgage Loans Held in Securitization Trusts – Residential mortgage loans held in securitization trusts are comprised of certain ARM loans transferred to Consolidated VIEs that have been securitized into sequentially rated classes of beneficial interests. The Company accounted for these securitization trusts as financings which are consolidated into the Company’s financial statements. Residential mortgage loans held in securitization trusts are carried at their unpaid principal balances, net of unamortized premium or discount, unamortized loan origination costs and allowance for loan losses. Interest income is accrued and recognized as revenue when earned according to the terms of the mortgage loans and when, in the opinion of management, it is collectible. The accrual of interest on loans is discontinued when, in management’s opinion, the interest is not collectible in the normal course of business, but in all cases when payment becomes greater than 90 days delinquent. Loans return to accrual status when principal and interest become current and are anticipated to be fully collectible. We establish an allowance for loan losses based on management's judgment and estimate of credit losses inherent in our portfolio of residential mortgage loans held in securitization trusts. Estimation involves the consideration of various credit-related factors, including but not limited to, macro-economic conditions, current housing market conditions, loan-to-value ratios, delinquency status, historical credit loss severity rates, purchased mortgage insurance, the borrower's current economic condition and other factors deemed to warrant consideration. Additionally, we look at the balance of any delinquent loan and compare that to the current value of the collateralizing property. We utilize various home valuation methodologies including appraisals, broker pricing opinions, internet-based property data services to review comparable properties in the same area or consult with a real estate agent in the property's area. |
Acquired Distressed Residential Mortgage Loans | Acquired Distressed Residential Mortgage Loans – Distressed residential mortgage loans are comprised of pools of fixed and adjustable rate residential mortgage loans acquired by the Company at a discount, with evidence of credit deterioration since their origination and where it is possible that the Company will not collect all contractually required principal payments. Distressed residential mortgage loans held in securitization trusts are distressed residential mortgage loans transferred to Consolidated VIEs that have been securitized into beneficial interests. The Company accounted for these securitization trusts as financings which are consolidated into the Company’s financial statements. Acquired distressed residential mortgage loans that have evidence of deteriorated credit quality at acquisition are accounted for under ASC 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality ("ASC 310-30"). Management evaluates whether there is evidence of credit quality deterioration as of the acquisition date using indicators such as past due or modified status, risk ratings, recent borrower credit scores and recent loan-to-value percentages. Acquired distressed residential mortgage loans are recorded at fair value at the date of acquisition, with no allowance for loan losses. Under ASC 310-30, the acquired loans may be accounted for individually or aggregated and accounted for as a pool of loans if the loans being aggregated have common risk characteristics. A pool is accounted for as a single asset with a single composite interest rate and an expectation of aggregate cash flows. Once a pool is assembled, it is treated as if it was one loan for purposes of applying the accounting guidance. Under ASC 310-30, the excess of cash flows expected to be collected over the carrying amount of the loans, referred to as the “accretable yield,” is accreted into interest income over the life of the loans in each pool or individually using a level yield methodology. Accordingly, our acquired distressed residential mortgage loans accounted for under ASC 310-30 are not subject to classification as nonaccrual classification in the same manner as our residential mortgage loans that were not distressed when acquired by us. Rather, interest income on acquired distressed residential mortgage loans relates to the accretable yield recognized at the pool level or on an individual loan basis, and not to contractual interest payments received at the loan level. The difference between contractually required principal and interest payments and the cash flows expected to be collected, referred to as the “nonaccretable difference,” includes estimates of both the impact of prepayments and expected credit losses over the life of the individual loan, or the pool (for loans grouped into a pool). Management monitors actual cash collections against its expectations, and revised cash flow estimates are prepared as necessary. A decrease in expected cash flows in subsequent periods may indicate that the loan pool or individual loan, as applicable, is impaired thus requiring the establishment of an allowance for loan losses by a charge to the provision for loan losses. An increase in expected cash flows in subsequent periods initially reduces any previously established allowance for loan losses by the increase in the present value of cash flows expected to be collected, and results in a recalculation of the amount of accretable yield for the loan pool. The adjustment of accretable yield due to an increase in expected cash flows is accounted for prospectively as a change in estimate. The additional cash flows expected to be collected are reclassified from the nonaccretable difference to the accretable yield, and the amount of periodic accretion is adjusted accordingly over the remaining life of the loans in the pool or individual loan, as applicable. The impacts of (i) prepayments, (ii) changes in variable interest rates, and (iii) any other changes in the timing of expected cash flows are recognized prospectively as adjustments to interest income. A distressed residential mortgage loan disposal, which may include a loan sale, receipt of payment in full from the borrower or foreclosure, results in removal of the loan from the loan pool at its allocated carrying amount. In the event of a sale of the loan and receipt of payment (in full or partial) from the borrower, a gain or loss on sale is recognized and reported based on the difference between the sales proceeds or payment from the borrower and the allocated carrying amount of the acquired distressed residential mortgage loan. In the case of a foreclosure, an individual loan is removed from the pool, a gain or loss on sale is recognized and reported based on the difference between the fair value of the underlying collateral less costs to sell and the carrying amount of the acquired distressed residential mortgage loan. The Company uses the specific allocation method for the removal of loans as the estimated cash flows and related carrying amount for each individual loan are known. In these cases, the remaining accretable yield is unaffected and any material change in remaining effective yield caused by the removal of the loan from the pool is addressed by the re-assessment of the estimate of cash flows for the pool prospectively. Acquired distressed residential mortgage loans subject to modification are not removed from the pool even if those loans would otherwise be considered troubled debt restructurings because the pool, and not the individual loan, represents the unit of account. For individual loans not accounted for in pools that are sold or satisfied by payment in full, a gain or loss on sale is recognized and reported based on the difference between the sales proceeds and the carrying amount of the acquired distressed residential mortgage loan. In the case of a foreclosure, a gain or loss sale is recognized and reported based on the difference between the fair value of the underlying collateral less costs to sell and the carrying amount of the acquired distressed residential mortgage loan. |
Multi-Family Loans Held in Securitization Trusts | Multi-Family Loans Held in Securitization Trusts – Multi-family loans held in securitization trusts are comprised of multi-family mortgage loans held in 5 Freddie Mac-sponsored multi-family K-Series securitizations (the “Consolidated K-Series”) as of June 30, 2016 and December 31, 2015 . Based on a number of factors, we determined that we were the primary beneficiary of each VIE within the Consolidated K-Series, met the criteria for consolidation and, accordingly, have consolidated these Freddie Mac-sponsored multi-family K-Series securitizations, including their assets, liabilities, income and expenses in our financial statements. The Company has elected the fair value option on each of the assets and liabilities held within the Consolidated K-Series, which requires that changes in valuations be reflected in the Company's accompanying condensed consolidated statement of operations. The Company has adopted ASU 2014-13 effective January 1, 2016, which updates the guidance on measuring the financial assets and financial liabilities of consolidated collateralized financing entities, or CFEs. The update allows the Company to measure both the financial assets and financial liabilities of a qualifying CFE it consolidates using the fair value of either the CFE’s financial assets or financial liabilities, whichever is more observable. As the Company’s securitization trusts are considered qualifying CFEs, the Company determines the fair value of multi-family loans held in securitization trusts based on the fair value of its multi-family collateralized debt obligations and its retained interests from these securitizations (eliminated in consolidation in accordance with U.S. GAAP), as the fair value of these instruments is more observable. Interest income is accrued and recognized as revenue when earned according to the terms of the multi-family loans and when, in the opinion of management, it is collectible. The accrual of interest on multi-family loans is discontinued when, in management’s opinion, the interest is not collectible in the normal course of business, but in all cases when payment becomes greater than 90 days delinquent. The multi-family loans return to accrual status when principal and interest become current and are anticipated to be fully collectible. |
Mezzanine Loan and Preferred Equity Investments, Mortgage Loans Held for Investment, and Investments in Unconsolidated Entities | Mezzanine Loan and Preferred Equity Investments – The Company invests in mezzanine loans and preferred equity of entities that have significant real estate assets. The mezzanine loan is secured by a pledge of the borrower’s equity ownership in the property. Unlike a mortgage, this loan does not represent a lien on the property. Therefore, it is always junior and subordinate to any first-lien as well as second liens, if applicable, on the property. These loans are senior to any preferred equity or common equity interests. A preferred equity investment is an equity investment in the entity that owns the underlying property. Preferred equity is not secured by the underlying property, but holders have priority relative to common equity holders on cash flow distributions and proceeds from capital events. In addition, preferred equity holders may be able to enhance their position and protect their equity position with covenants that limit the entity’s activities and grant the holder the exclusive right to control the property after an event of default. Mezzanine loans and preferred equity investments, where the risks and payment characteristics are equivalent to mezzanine loans, are accounted for as loans and are stated at unpaid principal balance, adjusted for any unamortized premium or discount, deferred fees or expenses, net of valuation allowances. The Company has evaluated its mezzanine loan and preferred equity investments for accounting treatment as loans versus equity investment utilizing the guidance provided by the ADC Arrangements Subsection of ASC 310, Receivables . For mezzanine loan and preferred equity investments where the characteristics, facts and circumstances indicate that loan accounting treatment is appropriate, the Company accretes or amortizes any discounts or premiums and deferred fees and expenses over the life of the related asset utilizing the effective interest method or straight line-method, if the result is not materially different. Management evaluates the collectibility of both interest and principal of each of these loans, if circumstances warrant, to determine whether they are impaired. A loan is impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due according to the existing contractual terms. When a loan is impaired, the amount of the loss accrual is calculated by comparing the carrying amount of the investment to the estimated fair value of the loan or, as a practical expedient, to the value of the collateral if the loan is collateral dependent. Interest income is accrued and recognized as revenue when earned according to the terms of the loans and when, in the opinion of management, it is collectible. The accrual of interest on loans is discontinued when, in management’s opinion, the interest is not collectible in the normal course of business, but in all cases when payment becomes greater than 90 days delinquent. Loans return to accrual status when principal and interest become current and are anticipated to be fully collectible. The Company had mezzanine loan and preferred equity investments accounted for as loans in the amounts of $75.3 million and $44.2 million as of June 30, 2016 and December 31, 2015 , respectively. Mezzanine loans and preferred equity investments where the risks and payment characteristics are equivalent to an equity investment are accounted for using the equity method of accounting. See “ Investment in Unconsolidated Entities. ” Mortgage Loans Held for Investment – Mortgage loans held for investment are stated at unpaid principal balance, adjusted for any unamortized premium or discount, deferred fees or expenses, net of valuation allowances, and are included in receivables and other assets. Interest income is accrued on the principal amount of the loan based on the loan’s contractual interest rate. Amortization of premiums and discounts is recorded using the effective yield method. Interest income, amortization of premiums and discounts and prepayment fees are reported in interest income. A loan is considered to be impaired when it is probable that based upon current information and events, the Company will be unable to collect all amounts due under the contractual terms of the loan agreement. Based on the facts and circumstances of the individual loans being impaired, loan specific valuation allowances are established for the excess carrying value of the loan over either: (i) the present value of expected future cash flows discounted at the loan’s original effective interest rate, (ii) the estimated fair value of the loan’s underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan’s observable market price. Investment in Unconsolidated Entities – Non-controlling, unconsolidated ownership interests in an entity may be accounted for using the equity method or the cost method. In circumstances where the Company has a non-controlling interest but either owns a significant interest or is able to exert influence over the affairs of the enterprise, the Company utilizes the equity method of accounting. Under the equity method of accounting, the initial investment is increased each period for additional capital contributions and a proportionate share of the entity’s earnings or preferred return and decreased for cash distributions and a proportionate share of the entity’s losses. Management periodically reviews its investments for impairment based on projected cash flows from the entity over the holding period. When any impairment is identified, the investments are written down to recoverable amounts. The Company had investment in unconsolidated entities accounted for under the equity method in the amounts of $10.7 million and $20.1 million as of June 30, 2016 and December 31, 2015 , respectively. The Company may elect the fair value option for an investment in an unconsolidated entity that is accounted for using the equity method. The Company elected the fair value option for certain investments in unconsolidated entities that own interests (directly or indirectly) in commercial and residential real estate assets because the Company determined that such presentation represents the underlying economics of the respective investment. The Company records the change in fair value of its investment in other income in the condensed consolidated statements of operations. The Company had investments in unconsolidated entities at fair value option included in investment in unconsolidated entities in the amounts of $63.1 million and $67.6 million as of June 30, 2016 and December 31, 2015 , respectively. Investments in unconsolidated entities accounted at fair value consist of the following as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 December 31, 2015 Investment Name Ownership Interest Carrying Amount Ownership Interest Carrying Amount RB Development Holding Company, LLC (1) ("RBDHC") — — 63% $ 1,927 RB Multifamily Investors LLC (1) (2) ("RBMI") — — 70% $ 56,891 Morrocroft Neighborhood Stabilization Fund II, LP 11% $ 10,579 13% $ 8,753 Evergreens JV Holdings, LLC (3) 85% $ 3,700 — — Bent Tree JV Holdings, LLC (3) 78% $ 9,780 — — Summerchase LR Partners LLC (3) 80% $ 4,360 — — Lake Mary Realty Partners, LLC (3) 80% $ 10,350 — — The Preserve at Port Royal Venture, LLC (3) 77% $ 11,910 — — WR Savannah Holdings, LLC (3) 90% $ 12,340 — — RB Distressed Investors LLC 9.3% $ 36 — — (1) As of May 16, 2016, RBDHC and RBMI became wholly-owned subsidiaries of the Company as a result of the Company's acquisition of the remaining ownership interests in those entities held by other unaffiliated entities ( see Note 19 ). (2) As of December 31, 2015, includes the Company's preferred and common equity interests in this entity. (3) Investments held by RBMI that are consolidated into the Company's financial statements beginning May 16, 2016. The following table presents income (loss) from investments in unconsolidated entities accounted at fair value for the three and six months ended June 30, 2016 and June 30, 2015 (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, Investment Name 2016 2015 2016 2015 RB Development Holding Company, LLC — $ (27 ) $ 107 $ 8 RB Multifamily Investors LLC $ 506 1,680 2,262 2,827 Morrocroft Neighborhood Stabilization Fund II, LP 234 — 591 9 Evergreens JV Holdings, LLC 10 — 10 0 Bent Tree JV Holdings, LLC 100 — 100 0 Summerchase LR Partners LLC 10 — 10 0 Lake Mary Realty Partners, LLC 20 — 20 0 The Preserve at Port Royal Venture, LLC 100 — 100 0 WR Savannah Holdings, LLC 60 — 60 0 RB Distressed Investors LLC — — — — The Company accounts for an investment that does not qualify for equity method accounting or for which the fair value option was not elected using the cost method if the Company determines the investment in the unconsolidated entity is insignificant. Under the cost method, equity in earnings is recorded as dividends are received to the extent they are not considered a return of capital, which is recorded as a reduction of cost of the investment. The Company had no investments in unconsolidated entities accounted for using the cost method. |
Inventory, Real Estate, Policy | Real Estate Under Development – The Company's expenditures which directly relate to the acquisition, development, construction and improvement of properties are capitalized, at cost. During the development period, which culminates once a property is substantially complete and ready for intended use, operating and carrying costs such as interest expense, real estate taxes, insurance and other direct costs are capitalized. Advertising and general administrative costs that do not relate to the development of a property are expensed as incurred. Real estate under development as of June 30, 2016 and December 31, 2015 of $15.6 million and $0 , respectively, is included in receivables and other assets on the condensed consolidated balance sheets. The Company periodically evaluates its long-lived assets for indicators of impairment. The judgments regarding the existence of impairment indicators are based on factors such as operational performance, market conditions and legal and environmental concerns, as well as the Company's ability to hold and its intent with regard to each asset. Future events could occur which would cause the Company to conclude that impairment indicators exist and an impairment is warranted. If impairment indicators exist for long-lived assets to be held and used, and the expected future undiscounted cash flows are less than the carrying amount of the asset, then the Company will record an impairment loss for the difference between the fair value of the asset and its carrying amount. If the asset is to be disposed of, then an impairment loss is recognized for the difference between the estimated fair value of the asset, less costs to sell, and its carrying amount. |
Cash and Cash Equivalents | Cash and Cash Equivalents – Cash and cash equivalents include cash on hand, amounts due from banks and overnight deposits. The Company maintains its cash and cash equivalents in highly rated financial institutions, and at times these balances exceed insurable amounts. |
Receivables and Other Assets | Receivables and Other Assets – Receivables and other assets as of June 30, 2016 and December 31, 2015 include restricted cash held by third parties of $55.7 million and $20.8 million , respectively. Included in restricted cash is $39.7 million and $11.6 million held in our Agency IO portfolio to be used for trading purposes and $10.6 million and $8.2 million held by counterparties as collateral for hedging instruments as of June 30, 2016 and December 31, 2015 , respectively. Interest receivable on multi-family loans held in securitization trusts is also included in the amounts of $23.6 million and $24.6 million as of June 30, 2016 and December 31, 2015 , respectively. |
Federal Home Loan Bank Advances | On February 20, 2015, our wholly-owned, captive-insurance subsidiary, Great Lakes Insurance Holdings LLC (“GLIH”), became a member of the Federal Home Loan Bank of Indianapolis (“FHLBI”). On January 12, 2016, the regulator of the Federal Home Loan Bank ("FHLB") system, the Federal Housing Finance Agency, released a final rule that amends regulations governing FHLB membership, including preventing captive insurance companies from being eligible for FHLB membership. Under the terms of the final rule, the Company's captive insurance subsidiary is required to terminate its membership and repay its existing advances within one year following the effective date of the final rule. In addition, the Company's captive insurance subsidiary is prohibited from taking new advances or renewing existing maturing advances during the one year transition period. The final rule became effective on February 19, 2016. During January 2016, the Company repaid all of its outstanding FHLBI advances, which repayment was funded primarily through repurchase agreement financing. |
Derivative Financial Instruments | Derivative Financial Instruments – In accordance with ASC 815, Derivatives and Hedging , the Company records derivative financial instruments on its consolidated balance sheet as assets or liabilities at fair value. Changes in fair value are accounted for depending on the use of the derivative instruments and whether they qualify for hedge accounting treatment. In connection with our investment in Agency IOs, the Company uses several types of derivative instruments such as interest rate swaps, futures, put and call options on futures and TBAs to hedge the interest rate risk, as well as spread risk associated with these investments. The Company also purchases, or sells short, To-Be-Announced securities (“TBAs”) through its Agency IO portfolio. TBAs are forward-settling purchases and sales of Agency RMBS where the underlying pools of mortgage loans are “To-Be-Announced.” Pursuant to these TBA transactions, we agree to purchase or sell, for future settlement, Agency RMBS with certain principal and interest terms and certain types of underlying collateral, but the particular Agency RMBS to be delivered is not identified until shortly before the TBA settlement date. For TBA contracts that we have entered into, we have not asserted that physical settlement is probable, therefore we have not designated these forward commitments as hedging instruments. The use of TBAs, futures, options on futures and interest rate swaps in our Agency IO portfolio hedge the overall risk profile of investment securities in the portfolio. The derivative instruments in our Agency IO portfolio are not designated as hedging instruments, therefore realized and unrealized gains and losses associated with these derivative instruments are recognized through earnings and reported as part of the other income (loss) category in the Company's condensed consolidated statements of operations. The Company also uses interest rate swaps to hedge the variable cash flows associated with borrowings made under its financing arrangements and Residential CDOs. We typically pay a fixed rate and receive a floating rate based on one month LIBOR, on the notional amount of the interest rate swaps. The floating rate we receive under our swap agreements has the effect of offsetting the repricing characteristics and cash flows of our financing arrangements. These interest rate swaps, qualify as a cash flow hedge, where the effective portion of the gain or loss on the derivative instrument is reported as a component of OCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The remaining gain or loss on the derivative instruments in excess of the cumulative change in the present value of future cash flows of the hedged item, if any, is recognized in current earnings during the period of change. |
Termination of Hedging Relationships | Termination of Hedging Relationships – The Company employs risk management monitoring procedures to ensure that the designated hedging relationships are demonstrating, and are expected to continue to demonstrate, a high level of effectiveness. Hedge accounting is discontinued on a prospective basis if it is determined that the hedging relationship is no longer highly effective or expected to be highly effective in offsetting changes in fair value of the hedged item. Additionally, the Company may elect to un-designate a hedge relationship during an interim period and re-designate upon the rebalancing of a hedge profile and the corresponding hedge relationship. When hedge accounting is discontinued, the Company continues to carry the derivative instruments at fair value with changes recorded in current earnings. |
Manager Compensation | Manager Compensation – We are a party to separate investment management agreements with Headlands Asset Management LLC (“Headlands”) and The Midway Group, LP (“Midway”), with Headlands providing investment management services with respect to our investments in certain distressed residential mortgage loans and Midway providing investment management services with respect to our investments in Agency IOs. These investment management agreements provide for the payment to our investment managers of a management fee, incentive fee and reimbursement of certain operating expenses, which are accrued and expensed during the period for which they are earned or incurred. |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) – The Company’s comprehensive income/(loss) attributable to the Company's common stockholders includes net income, the change in net unrealized gains/(losses) on its available for sale securities and its derivative hedging instruments, currently comprised of interest rate swaps, (to the extent that such changes are not recorded in earnings), adjusted by realized net gains/(losses) reclassified out of accumulated other comprehensive income/(loss) for available for sale securities, reduced by dividends declared on the Company’s preferred stock and increased for net loss attributable to non-controlling interest. |
Employee Benefit Plans | Employee Benefits Plans – The Company sponsors a defined contribution plan (the “Plan”) for all eligible domestic employees. The Plan qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”). The Company made $0.1 million in contributions to the Plan for the three and six months ended June 30, 2016 . The Company made no contributions to the Plan for the three and six months ended June 30, 2015 . |
Stock Based Compensation | Stock Based Compensation – The Company has awarded restricted stock to eligible employees and officers as part of their compensation. Compensation expense for equity based awards and stock issued for services are recognized over the vesting period of such awards and services based upon the fair value of the award at the grant date. In May 2015, the Company granted certain Performance Share Awards (“PSAs”) which cliff vest after a three -year period, subject to the achievement of certain performance criteria based on a formula tied to the Company’s achievement of three -year total stockholder return (“TSR”) and the Company’s TSR relative to the TSR of certain peer companies. The feature in this award constitutes a “market condition” which impacts the amount of compensation expense recognized for these awards. The grant date fair values of PSAs were determined through Monte-Carlo simulation analysis. |
Income Taxes | Income Taxes – The Company operates in such a manner so as to qualify as a REIT under the requirements of the Internal Revenue Code. Requirements for qualification as a REIT include various restrictions on ownership of the Company’s stock, requirements concerning distribution of taxable income and certain restrictions on the nature of assets and sources of income. A REIT must distribute at least 90% of its taxable income to its stockholders, of which 85% plus any undistributed amounts from the prior year must be distributed within the taxable year in order to avoid the imposition of an excise tax. Distribution of the remaining balance may extend until timely filing of the Company’s tax return in the subsequent taxable year. Qualifying distributions of taxable income are deductible by a REIT in computing taxable income. Certain activities of the Company are conducted through TRSs and therefore are subject to federal and various state and local income taxes. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. ASC 740, Income Taxes ("ASC 740"), provides guidance for how uncertain tax positions should be recognized, measured, presented, and disclosed in the financial statements. ASC 740 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. In situations involving uncertain tax positions related to income tax matters, we do not recognize benefits unless it is more likely than not that they will be sustained. ASC 740 was applied to all open taxable years as of the effective date. Management’s determinations regarding ASC 740 may be subject to review and adjustment at a later date based on factors including, but not limited to, an ongoing analysis of tax laws, regulations and interpretations thereof. The Company will recognize interest and penalties, if any, related to uncertain tax positions as income tax expense. |
Earnings Per Share | Earnings Per Share – Basic earnings per share excludes dilution and is computed by dividing net income attributable to the Company's common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. |
Segment Reporting | Segment Reporting – ASC 280, Segment Reporting , is the authoritative guidance for the way public entities report information about operating segments in their annual financial statements. We are a REIT focused on the business of acquiring, investing in, financing and managing primarily mortgage-related and financial assets, and currently operate in only one reportable segment. |
Summary of Recent Accounting Pronouncements | Summary of Recent Accounting Pronouncements Revenue Recognition (Topic 606) In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). This guidance creates a new, principle-based revenue recognition framework that will affect nearly every revenue-generating entity. ASU 2014-09 also creates a new topic in the Codification, Topic 606 (“ASC 606”). In addition to superseding and replacing nearly all existing U.S. GAAP revenue recognition guidance, including industry-specific guidance, ASC 606 does the following: (1) establishes a new control-based revenue recognition model; (2) changes the basis for deciding when revenue is recognized over time or at a point in time; (3) provides new and more detailed guidance on specific aspects of revenue recognition; and (4) expands and improves disclosures about revenue. In August 2015, the FASB issued ASU 2015-14 that defers the effective date of ASU 2014-09 for public business entities for annual reporting periods beginning after December 15, 2017, including interim periods therein. Early application is not permitted for public business entities. The Company is currently assessing the impact of this guidance. Consolidation (Topic 810) In August 2014, the FASB issued ASU 2014-13, Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity (“ASU 2014-13”). For entities that consolidate a collateralized financing entity within the scope of this update, an option to elect to measure the financial assets and the financial liabilities of that collateralized financing entity using either the measurement alternative included in this Update or Topic 820 on fair value measurement is provided. The guidance became effective for the Company beginning January 1, 2016. The adoption of this ASU using the modified retrospective approach did not have an impact on the Company's financial condition and results of operations. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis (“ASU 2015-02”) which changes the guidance on the consolidation of certain investment funds as well as both the variable interest model and the voting model. The guidance became effective for the Company beginning January 1, 2016. The adoption of this ASU did not have a material impact on the Company’s financial condition or results of operations. Interest - Imputation of Interest (Topic 835) In April 2015, the FASB issued ASU 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs (“ASU 2015-03”). The amendments in ASU 2015-03 are intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The guidance became effective for the Company beginning January 1, 2016. The adoption of this ASU did not have a material impact on the Company’s financial condition or results of operations. Financial Instruments - Overall (Subtopic 825-10) In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities ("ASU 2016-01"). The amendments in ASU 2016-01 require (1) equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, (2) public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (3) separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) and eliminates the requirement for public business entities to disclose the method(s) and (4) significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently assessing the impact of this guidance. Leases (Topic 842) In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) ("ASU 2016-02") which required organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations creates by those leases. Under the new guidance, a lessee will be required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. Both types of leases however must now be recognized on the balance sheet. The lessee will be required to recognize both a lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently assessing the impact of this guidance. Investments - Equity Method and Joint Ventures (Topic 323) In March 2016, the FASB issued ASU 2016-07, Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting ("ASU 2016-07"). The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. Therefore, upon qualifying for the equity method of accounting, no retroactive adjustment of the investment is required. Additionally, the amendments require that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Early adoption is permitted. The Company is currently assessing the impact of this guidance. Compensation - Stock Compensation (Topic 718) In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). The amendments simplify several aspects of the accounting for share-based payment award transaction including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. The amendments are effective beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for any interim or annual period. The Company has determined that this ASU will not have a material impact on the Company's financial condition or results of operations. Financial Instruments —Credit Losses (Topic 326) In June 2016, the FASB issued ASU 2016-13, Financial Instruments —Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). The amendments require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments are effective beginning after December 15, 2019, and interim periods within those annual periods. Early adoption is permitted. The Company is currently assessing the impact of this guidance. |
Residential collateralized debt obligations | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Residential Collateralized Debt Obligations, Multi-Family Collateralized Debt Obligations, and Securitized Debt | Residential Collateralized Debt Obligations (“Residential CDOs”) – We use Residential CDOs to permanently finance our residential mortgage loans held in securitization trusts. For financial reporting purposes, the ARM loans held as collateral are recorded as assets of the Company and the Residential CDOs are recorded as the Company’s debt. The Company completed four securitizations in 2005 and 2006. The first three were accounted for as a permanent financing while the fourth was accounted for as a sale and accordingly, is not included in the Company’s accompanying condensed consolidated financial statements. |
Multi-family collateralized debt obligations | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Residential Collateralized Debt Obligations, Multi-Family Collateralized Debt Obligations, and Securitized Debt | Multi-Family Collateralized Debt Obligations (“Multi-Family CDOs”) – We consolidated the Consolidated K-Series including their debt, referred to as Multi-Family CDOs, in our financial statements. The Multi-Family CDOs permanently finance the multi-family mortgage loans held in the Consolidated K-Series securitizations. For financial reporting purposes, the loans held as collateral are recorded as assets of the Company and the Multi-Family CDOs are recorded as the Company’s debt. We refer to both the Residential CDOs and Multi-Family CDOs as CDOs in this report. |
Securitized debt | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Residential Collateralized Debt Obligations, Multi-Family Collateralized Debt Obligations, and Securitized Debt | Securitized Debt – Securitized Debt represents third-party liabilities of Consolidated VIEs and excludes liabilities of the VIEs acquired by the Company that are eliminated on consolidation. The Company has entered into several financing transactions that resulted in the Company consolidating as VIEs the special purpose entities (the “SPEs”) that were created to facilitate the transactions and to which underlying assets in connection with the financing were transferred. The Company engaged in these transactions primarily to obtain permanent or longer term financing on a portion of its multi-family CMBS and acquired distressed residential mortgage loans. Costs related to issuance of securitized debt which include underwriting, rating agency, legal, accounting and other fees are reflected as deferred charges. Such costs are presented as a deduction from the corresponding debt liability on the Company’s accompanying condensed consolidated balance sheets in the amount of $1.8 million and $1.0 million as of June 30, 2016 and December 31, 2015 , respectively. These deferred charges are amortized as an adjustment to interest expense using the effective interest method, or straight line-method, if the result is not materially different. |
Portfolio Investments | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Financing Arrangements, Portfolio Investments and Residential Mortgage Loans | Financing Arrangements, Portfolio Investments – The Company finances the majority of its investment securities available for sale using repurchase agreements. Under a repurchase agreement, an asset is sold to a counterparty to be repurchased at a future date at a predetermined price, which represents the original sales price plus interest. The Company accounts for these repurchase agreements as financings and are carried at their contractual amounts, as specified in the respective agreements. Borrowings under repurchase agreements generally bear interest rates of a specified margin over one-month LIBOR. |
Distressed Residential Mortgage Loans | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Financing Arrangements, Portfolio Investments and Residential Mortgage Loans | Financing Arrangements, Residential Mortgage Loans – The Company finances a portion of its residential mortgage loans, including its distressed residential mortgage loans, through a repurchase agreement expiring within 12 to 15 months. The borrowing under the repurchase agreement bears an interest rate of a specified margin over one-month LIBOR. The repurchase agreement is treated as a collateralized financing transaction and is carried at the contractual amounts, as specified in the respective agreement. Costs related to the establishment of the repurchase agreement which include underwriting, legal, accounting and other fees are reflected as deferred charges. Such costs are presented as a deduction from the corresponding debt liability on the Company’s accompanying condensed consolidated balance sheets in the amount of $1.4 million as of June 30, 2016 and $2.3 million as of December 31, 2015 . These deferred charges are amortized as an adjustment to interest expense using the effective interest method, or straight line-method, if the result is not materially different. |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Investments in Unconsolidated Entities | Investments in unconsolidated entities accounted at fair value consist of the following as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 December 31, 2015 Investment Name Ownership Interest Carrying Amount Ownership Interest Carrying Amount RB Development Holding Company, LLC (1) ("RBDHC") — — 63% $ 1,927 RB Multifamily Investors LLC (1) (2) ("RBMI") — — 70% $ 56,891 Morrocroft Neighborhood Stabilization Fund II, LP 11% $ 10,579 13% $ 8,753 Evergreens JV Holdings, LLC (3) 85% $ 3,700 — — Bent Tree JV Holdings, LLC (3) 78% $ 9,780 — — Summerchase LR Partners LLC (3) 80% $ 4,360 — — Lake Mary Realty Partners, LLC (3) 80% $ 10,350 — — The Preserve at Port Royal Venture, LLC (3) 77% $ 11,910 — — WR Savannah Holdings, LLC (3) 90% $ 12,340 — — RB Distressed Investors LLC 9.3% $ 36 — — (1) As of May 16, 2016, RBDHC and RBMI became wholly-owned subsidiaries of the Company as a result of the Company's acquisition of the remaining ownership interests in those entities held by other unaffiliated entities ( see Note 19 ). (2) As of December 31, 2015, includes the Company's preferred and common equity interests in this entity. (3) Investments held by RBMI that are consolidated into the Company's financial statements beginning May 16, 2016. The following table presents income (loss) from investments in unconsolidated entities accounted at fair value for the three and six months ended June 30, 2016 and June 30, 2015 (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, Investment Name 2016 2015 2016 2015 RB Development Holding Company, LLC — $ (27 ) $ 107 $ 8 RB Multifamily Investors LLC $ 506 1,680 2,262 2,827 Morrocroft Neighborhood Stabilization Fund II, LP 234 — 591 9 Evergreens JV Holdings, LLC 10 — 10 0 Bent Tree JV Holdings, LLC 100 — 100 0 Summerchase LR Partners LLC 10 — 10 0 Lake Mary Realty Partners, LLC 20 — 20 0 The Preserve at Port Royal Venture, LLC 100 — 100 0 WR Savannah Holdings, LLC 60 — 60 0 RB Distressed Investors LLC — — — — |
Investment Securities Availab30
Investment Securities Available for Sale (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Available for Sale Securities | Investment securities available for sale consisted of the following as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 December 31, 2015 Amortized Cost Unrealized Fair Value Amortized Cost Unrealized Fair Value Gains Losses Gains Losses Agency RMBS (1) Agency ARMs Freddie Mac $ 44,256 $ 254 $ (149 ) $ 44,361 $ 62,383 $ 41 $ (770 ) $ 61,654 Fannie Mae 83,028 396 (197 ) 83,227 92,605 121 (1,334 ) 91,392 Ginnie Mae 7,114 — (232 ) 6,882 20,172 55 (260 ) 19,967 Total Agency ARMs 134,398 650 (578 ) 134,470 175,160 217 (2,364 ) 173,013 Agency Fixed Rate Freddie Mac 27,992 5 (165 ) 27,832 31,076 — (719 ) 30,357 Fannie Mae 348,547 139 (4,198 ) 344,488 380,684 — (12,149 ) 368,535 Ginnie Mae 507 — (3 ) 504 25,923 9 (111 ) 25,821 Total Agency Fixed Rate 377,046 144 (4,366 ) 372,824 437,683 9 (12,979 ) 424,713 Agency IOs (1) Freddie Mac 23,185 628 (5,076 ) 18,737 28,970 680 (4,471 ) 25,179 Fannie Mae 37,709 1,052 (8,783 ) 29,978 39,603 433 (6,341 ) 33,695 Ginnie Mae 64,236 2,420 (9,361 ) 57,295 63,050 511 (7,045 ) 56,516 Total Agency IOs 125,130 4,100 (23,220 ) 106,010 131,623 1,624 (17,857 ) 115,390 Total Agency RMBS 636,574 4,894 (28,164 ) 613,304 744,466 1,850 (33,200 ) 713,116 Non-Agency RMBS 110,349 280 (258 ) 110,371 1,727 51 (211 ) 1,567 U.S. Treasury securities (1) 7,982 15 — 7,997 10,113 — (76 ) 10,037 CMBS (2) 52,274 12,603 (60 ) 64,817 28,692 12,042 — 40,734 Total investment securities available for sale $ 807,179 $ 17,792 $ (28,482 ) $ 796,489 $ 784,998 $ 13,943 $ (33,487 ) $ 765,454 (1) Included in investment securities available for sale are Agency IOs, Agency RMBS and U.S. Treasury securities managed by Midway that are measured at fair value through earnings. (2) Included in CMBS is $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively. |
Weighted Average Lives of Investment Securities Available for Sale | The following table sets forth the weighted average lives our investment securities available for sale as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): Weighted Average Life June 30, 2016 December 31, 2015 0 to 5 years $ 652,280 $ 518,594 Over 5 to 10 years 141,421 219,747 10+ years 2,788 27,113 Total $ 796,489 $ 765,454 |
Stated Reset Periods of Investment Securities Available for Sale | The following tables set forth the stated reset periods of our investment securities available for sale and investment securities available for sale held in securitization trusts at June 30, 2016 and December 31, 2015 at carrying value (dollar amounts in thousands): June 30, 2016 December 31, 2015 Less than 6 6 to 24 More than Total Less than 6 to 24 More than Total Agency RMBS $ 71,056 $ 29,767 $ 512,481 $ 613,304 $ 92,693 $ 44,700 $ 575,723 $ 713,116 Non-Agency RMBS 1,320 — 109,051 110,371 188 1,379 — 1,567 U.S. Treasury securities 7,997 — — 7,997 10,037 — — 10,037 CMBS 22,546 — 42,271 64,817 — — 40,734 40,734 Total investment securities available for sale $ 102,919 $ 29,767 $ 663,803 $ 796,489 $ 102,918 $ 46,079 $ 616,457 $ 765,454 |
Schedule of Investment Securities Available for Sale in Unrealized Loss Position | The following tables present the Company's investment securities available for sale in an unrealized loss position reported through OCI, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 Less than 12 Months Greater than 12 months Total Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Agency RMBS $ 4,478 $ (25 ) $ 375,146 $ (4,916 ) $ 379,624 $ (4,941 ) Non-Agency RMBS 21,114 (128 ) 148 (130 ) $ 21,262 $ (258 ) CMBS 10,269 (60 ) — — $ 10,269 $ (60 ) Total investment securities available for sale $ 35,861 $ (213 ) $ 375,294 $ (5,046 ) $ 411,155 $ (5,259 ) December 31, 2015 Less than 12 Months Greater than 12 months Total Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Carrying Value Gross Unrealized Losses Agency RMBS $ 71,587 $ (688 ) $ 476,157 $ (14,497 ) $ 547,744 $ (15,185 ) Non-Agency RMBS 771 — 796 (211 ) $ 1,567 $ (211 ) Total investment securities available for sale $ 72,358 $ (688 ) $ 476,953 $ (14,708 ) $ 549,311 $ (15,396 ) |
Residential Mortgage Loans He31
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Mortgage Loans on Real Estate [Abstract] | |
Schedule of Residential Mortgage Loans Held in Securitization Trusts (Net) | Residential mortgage loans held in securitization trusts (net) consist of the following as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Unpaid principal balance $ 109,214 $ 122,545 Deferred origination costs – net 691 775 Reserve for loan losses (3,732 ) (3,399 ) Total $ 106,173 $ 119,921 |
Allowance for Loan Losses on Residential Mortgage Loans Held in Securitization Trusts | The following table presents the activity in the Company's allowance for loan losses on residential mortgage loans held in securitization trusts for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 3,399 $ 3,631 Provisions for loan losses 409 656 Transfer to real estate owned — 1 Charge-offs (76 ) (196 ) Balance at the end of period $ 3,732 $ 4,092 |
Activity in Real Estate Owned Held in Residential Securitization Trust | The following table presents the activity in the Company’s real estate owned held in residential securitization trusts for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 411 $ 965 Write downs — — Transfer from/(to) mortgage loans held in securitization trusts — (192 ) Disposal (339 ) (362 ) Balance at the end of period $ 72 $ 411 |
Delinquencies in Portfolio of Residential Mortgage Loans Held in Securitization Trusts | The table below shows delinquencies in our portfolio of residential mortgage loans held in securitization trusts, including real estate owned through foreclosure (REO), as of December 31, 2015 (dollar amounts in thousands): December 31, 2015 Days Late Number of Delinquent Loans Total Unpaid Principal % of Loan Portfolio 30 - 60 3 $ 825 0.67 % 61 - 90 2 $ 1,763 1.43 % 90 + 26 $ 15,365 12.48 % Real estate owned through foreclosure 3 $ 574 0.47 % he table below shows delinquencies in our portfolio of residential mortgage loans held in securitization trusts, including REO through foreclosure, as of June 30, 2016 (dollar amounts in thousands): June 30, 2016 Days Late Number of Delinquent Loans Total Unpaid Principal % of Loan Portfolio 30 - 60 — $ — — % 61 - 90 1 $ 118 0.11 % 90 + 29 $ 12,277 11.22 % Real estate owned through foreclosure 1 $ 168 0.15 % |
Schedule of Geographic Concentration of Credit Risk | The geographic concentrations of credit risk exceeding 5% of the total loan balances in our residential mortgage loans held in securitization trusts and real estate owned held in residential securitization trusts as of June 30, 2016 and December 31, 2015 are as follows: June 30, 2016 December 31, 2015 New York 35.2 % 35.6 % Massachusetts 19.9 % 20.7 % New Jersey 10.3 % 11.1 % Florida 8.5 % 7.7 % Connecticut 7.1 % 6.5 % Maryland 5.1 % 4.9 % |
Distressed Residential Mortga32
Distressed Residential Mortgage Loans (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Mortgage Loans on Real Estate [Line Items] | |
Schedule of Information of Distressed Residential Mortgage Loans Acquired | The following table presents information regarding the estimates of the contractually required payments, the cash flows expected to be collected, and the estimated fair value of the distressed residential mortgage loans acquired during the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): June 30, 2016 June 30, 2015 Contractually required principal and interest $ 88,907 $ 70,630 Non-accretable yield (7,470 ) (3,997 ) Expected cash flows to be collected 81,437 66,633 Accretable yield (43,613 ) (37,225 ) Fair value at the date of acquisition $ 37,824 $ 29,408 |
Activity in Accretable Yield for Distressed Residential Mortgage Loans | The following table details activity in accretable yield for the distressed residential mortgage loans, including distressed residential mortgage loans held in securitization trusts, for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): June 30, 2016 June 30, 2015 Balance at beginning of period $ 579,009 $ 640,416 Additions 51,288 44,485 Disposals (71,137 ) (34,897 ) Accretion (17,301 ) (20,486 ) Balance at end of period (1) $ 541,859 $ 629,518 (1) Accretable yield is the excess of the distressed residential mortgage loans’ cash flows expected to be collected over the purchase price. The cash flows expected to be collected represents the Company’s estimate of the amount and timing of undiscounted principal and interest cash flows. Additions include accretable yield estimates for purchases made during the period and reclassification to accretable yield from nonaccretable yield. Deletions include distressed residential mortgage loan dispositions, which include refinancing, sale and foreclosure of the underlying collateral and resulting removal of the distressed residential mortgage loans from the accretable yield, and reclassifications from accretable to nonaccretable yield. The reclassifications between accretable and nonaccretable yield and the accretion of interest income is based on various estimates regarding loan performance and the value of the underlying real estate securing the loans. As the Company continues to update its estimates regarding the loans and the underlying collateral, the accretable yield may change. Therefore, the amount of accretable income recorded in the six -month period ended June 30, 2016 and 2015 is not necessarily indicative of future results. |
Schedule of Geographic Concentration of Credit Risk | The geographic concentrations of credit risk exceeding 5% of the total loan balances in our residential mortgage loans held in securitization trusts and real estate owned held in residential securitization trusts as of June 30, 2016 and December 31, 2015 are as follows: June 30, 2016 December 31, 2015 New York 35.2 % 35.6 % Massachusetts 19.9 % 20.7 % New Jersey 10.3 % 11.1 % Florida 8.5 % 7.7 % Connecticut 7.1 % 6.5 % Maryland 5.1 % 4.9 % |
Distressed residential mortgage loans held in securitization trust, (net) | |
Mortgage Loans on Real Estate [Line Items] | |
Schedule of Geographic Concentration of Credit Risk | The geographic concentrations of credit risk exceeding 5% of the unpaid principal balance of our distressed residential mortgage loans, including distressed residential mortgage loans held in securitization trusts, as of June 30, 2016 and December 31, 2015 , respectively, are as follows: June 30, 2016 December 31, 2015 Florida 11.9 % 12.6 % California 8.3 % 7.7 % North Carolina 8.0 % 8.1 % Georgia 6.1 % 6.1 % Maryland 5.2 % 5.4 % New York 5.0 % 5.2 % |
Consolidated K-Series (Tables)
Consolidated K-Series (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Mortgage Loans on Real Estate [Line Items] | |
Schedule of Geographic Concentration of Credit Risk | The geographic concentrations of credit risk exceeding 5% of the total loan balances in our residential mortgage loans held in securitization trusts and real estate owned held in residential securitization trusts as of June 30, 2016 and December 31, 2015 are as follows: June 30, 2016 December 31, 2015 New York 35.2 % 35.6 % Massachusetts 19.9 % 20.7 % New Jersey 10.3 % 11.1 % Florida 8.5 % 7.7 % Connecticut 7.1 % 6.5 % Maryland 5.1 % 4.9 % |
Consolidated K-Series | |
Mortgage Loans on Real Estate [Line Items] | |
Condensed Consolidated Balance Sheet of the Consolidated K-Series | The condensed consolidated balance sheets of the Consolidated K-Series at June 30, 2016 and December 31, 2015 , respectively, are as follows (dollar amounts in thousands): Balance Sheets June 30, 2016 December 31, 2015 Assets Multi-family loans held in securitization trusts $ 7,282,145 $ 7,105,336 Receivables 23,618 24,579 Total Assets $ 7,305,763 $ 7,129,915 Liabilities and Equity Multi-family CDOs $ 6,981,813 $ 6,818,901 Accrued expenses 23,523 24,483 Total Liabilities 7,005,336 6,843,384 Equity 300,427 286,531 Total Liabilities and Equity $ 7,305,763 $ 7,129,915 |
Condensed Consolidated Statements of Operations of the Consolidated K-Series | The condensed consolidated statements of operations of the Consolidated K-Series for the three and six months ended June 30, 2016 and 2015 , respectively, are as follows (dollar amounts in thousands): Three Months Ended Six Months Ended Statements of Operations 2016 2015 2016 2015 Interest income $ 61,769 $ 62,984 $ 125,301 $ 129,284 Interest expense 55,224 56,992 112,424 117,087 Net interest income 6,545 5,992 12,877 12,197 Unrealized gain on multi-family loans and debt held in securitization trusts, net 784 5,418 1,602 19,046 Net Income $ 7,329 $ 11,410 $ 14,479 $ 31,243 |
Multi-family loans held in securitization trusts | |
Mortgage Loans on Real Estate [Line Items] | |
Schedule of Geographic Concentration of Credit Risk | The geographic concentrations of credit risk exceeding 5% of the total loan balances related to our CMBS investments included in investment securities available for sale and multi-family loans held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively, are as follows: June 30, 2016 December 31, 2015 California 13.9 % 13.8 % Texas 12.4 % 12.3 % New York 8.1 % 8.0 % Maryland 5.3 % 5.2 % |
Use of Special Purpose Entiti34
Use of Special Purpose Entities and Variable Interest Entities (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Variable Interest Entity [Line Items] | |
Schedule of Assets and Liabilities of Consolidated VIE's | The following table presents the carrying value and estimated fair value of the Company’s financial instruments at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Fair Value Hierarchy Level Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Financial Assets: Cash and cash equivalents Level 1 $ 49,941 $ 49,941 $ 61,959 $ 61,959 Investment securities available for sale (1) Level 1, 2 or 3 796,489 796,489 765,454 765,454 Residential mortgage loans held in securitization trusts (net) Level 3 106,173 93,314 119,921 109,120 Distressed residential mortgage loans (net) (2) Level 3 543,361 544,858 558,989 564,310 Multi-family loans held in securitization trusts Level 3 7,282,145 7,282,145 7,105,336 7,105,336 Derivative assets Level 1 or 2 291,680 291,680 228,775 228,775 Mortgage loans held for sale (net) (3) Level 3 5,283 5,328 5,471 5,557 Mortgage loans held for investment (3) Level 3 10,391 10,531 2,706 2,846 Mezzanine loan and preferred equity investments (4) Level 3 75,300 76,004 44,151 44,540 Investment in unconsolidated entities (5) Level 3 73,839 74,304 87,662 87,558 Financial Liabilities: Financing arrangements, portfolio investments Level 2 $ 618,050 $ 618,050 $ 577,413 $ 577,413 Financing arrangements, residential mortgage loans Level 2 174,798 174,798 212,155 212,155 Residential collateralized debt obligations Level 3 102,597 92,522 116,710 105,606 Multi-family collateralized debt obligations Level 3 6,981,813 6,981,813 6,818,901 6,818,901 Securitized debt Level 3 244,016 252,252 116,541 123,776 Derivative liabilities Level 1 or 2 6,438 6,438 1,500 1,500 Payable for securities purchased Level 1 286,452 286,452 227,969 227,969 Subordinated debentures Level 3 45,000 44,081 45,000 42,731 (1) Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively. (2) Includes distressed residential mortgage loans held in securitization trusts with a carrying value amounting to approximately $225.4 million and $114.2 million at June 30, 2016 and December 31, 2015 , respectively, and distressed residential mortgage loans with a carrying value amounting to approximately $318.0 million and $444.8 million at June 30, 2016 and December 31, 2015 , respectively. (3) Included in receivables and other assets in the accompanying condensed consolidated balance sheets. (4) Includes mezzanine loan and preferred equity investments accounted for as loans ( see Note 2 ). (5) Includes investments in unconsolidated entities accounted for under the fair value option with a carrying value of $63.1 million and $67.6 million at June 30, 2016 and December 31, 2015 , respectively. |
Summary of Securitized Debt | The following table summarizes the Company’s securitized debt collateralized by multi-family CMBS and distressed residential mortgage loans (dollar amounts in thousands): Multi-family CMBS Re-securitization (1) Collateralized Recourse Financing (2) Distressed Residential Mortgage Loan Securitizations Principal Amount at June 30, 2016 $ 33,666 $ 55,853 $ 162,411 Principal Amount at December 31, 2015 $ 33,781 $ 55,853 $ 33,656 Carrying Value at June 30, 2016 (3) $ 27,961 $ 55,751 $ 160,304 Carrying Value at December 31, 2015 (3) $ 27,613 $ 55,629 $ 33,299 Pass-through rate of Notes issued 5.35% One-month LIBOR plus 5.25% 4% - 4.85% (1) The Company engaged in the re-securitization transaction primarily for the purpose of obtaining non-recourse financing on a portion of its multi-family CMBS portfolio. As a result of engaging in this transaction, the Company remains economically exposed to the first loss position on the underlying multi-family CMBS transferred to the Consolidated VIE. The holders of the note issued in this re-securitization transaction have no recourse to the general credit of the Company, but the Company does have the obligation, under certain circumstances, to repurchase assets upon the breach of certain representations and warranties. The Company will receive all remaining cash flow, if any, through its retained ownership. (2) The Company entered into a CMBS Master Repurchase Agreement with a three -year term for the purpose of financing a portion of its multi-family CMBS portfolio. In connection with the transaction, the Company agreed to guarantee the due and punctual payment of its wholly-owned subsidiary's obligations under the CMBS Master Repurchase Agreement. (3) Classified as securitized debt in the liability section of the Company’s accompanying condensed consolidated balance sheets, net of debt issuance costs. The following tables present the classification and carrying value of unconsolidated VIEs as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 Investment securities, available for sale, at fair value Receivables and other Assets Mezzanine loan and preferred equity investments Investment in unconsolidated entities Total Multi-family CMBS $ 42,271 $ 75 $ — $ — $ 42,346 Mezzanine/Construction loan on multi-family properties — — 19,180 — 19,180 Preferred equity investment on multi-family properties — — 56,120 10,784 66,904 Equity investment in entities that invest in multi-family properties — — — 22,955 22,955 Total assets $ 42,271 $ 75 $ 75,300 $ 33,739 $ 151,385 December 31, 2015 Investment securities, available for sale, at fair value Receivables and other Assets Mezzanine loan and preferred equity investments Investment in unconsolidated entities Total Multi-family CMBS $ 40,734 $ 76 $ — $ — $ 40,810 Mezzanine/Construction loan on multi-family properties — — 8,663 8,718 17,381 Preferred equity investment on multi-family properties — — 35,488 10,776 46,264 Equity investment in entities that invest in multi-family properties — — — 66,242 66,242 Total assets $ 40,734 $ 76 $ 44,151 $ 85,736 $ 170,697 |
Schedule of Contractual Maturities of Financing VIE's | The following table presents contractual maturity information about the Financing VIEs’ securitized debt as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): Scheduled Maturity (principal amount) June 30, 2016 December 31, 2015 Within 24 months $ 55,853 $ 89,509 Over 24 months to 36 months 162,411 — Over 36 months 33,666 33,781 Total outstanding principal 251,930 123,290 Discount (6,154 ) (5,763 ) Debt Issuance Cost (1,760 ) (986 ) Carrying value $ 244,016 $ 116,541 |
Financing VIE | |
Variable Interest Entity [Line Items] | |
Schedule of Assets and Liabilities of Consolidated VIE's | Assets and Liabilities of Consolidated VIEs as of December 31, 2015 (dollar amounts in thousands): Financing VIEs Non-financed VIE Multi-family CMBS re- securitization (1) Collateralized Recourse Financing (2) Distressed Residential Mortgage Loan Securitization (3) Residential Mortgage Loan Securitization Multi- family CMBS Total Investment securities available for sale, at fair value held in securitization trusts $ 40,734 $ — $ — $ — $ — $ 40,734 Residential mortgage loans held in securitization trusts (net) — — — 119,921 — 119,921 Distressed residential mortgage loans held in securitization trust (net) — — 114,214 — — 114,214 Multi-family loans held in securitization trusts, at fair value 1,224,036 4,633,061 — — 1,248,239 7,105,336 Receivables and other assets 4,864 15,281 6,076 1,200 5,456 32,877 Total assets $ 1,269,634 $ 4,648,342 $ 120,290 $ 121,121 $ 1,253,695 $ 7,413,082 Residential collateralized debt obligations $ — $ — $ — $ 116,710 $ — $ 116,710 Multi-family collateralized debt obligations, at fair value 1,168,470 4,464,340 — — 1,186,091 6,818,901 Securitized debt 27,613 55,629 33,299 — — 116,541 Accrued expenses and other liabilities 4,436 14,750 368 13 5,456 25,023 Total liabilities $ 1,200,519 $ 4,534,719 $ 33,667 $ 116,723 $ 1,191,547 $ 7,077,175 (1) The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization ( see Note 6 ). (2) The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations ( see Note 6 ). (3) The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to distressed residential mortgage loan securitizations transactions completed in 2013. The outstanding notes from these transactions were repaid in February 2016. Assets and Liabilities of Consolidated VIEs as of June 30, 2016 (dollar amounts in thousands): Financing VIEs Other VIEs Multi-family CMBS re- securitization (1) Collateralized Recourse Financing (2) Distressed Residential Mortgage Loan Securitization (3) Residential Mortgage Loan Securitization Non-financed VIE - Multi- family CMBS (2) Other Total Cash and cash equivalents $ — $ — $ — $ — $ — $ 852 $ 852 Investment securities available for sale, at fair value held in securitization trusts 42,271 — — — — — 42,271 Residential mortgage loans held in securitization trusts (net) — — — 106,173 — — 106,173 Distressed residential mortgage loans held in securitization trust, (net) — — 225,370 — — — 225,370 Multi-family loans held in securitization trusts, at fair value 1,251,124 4,784,427 — — 1,246,594 — 7,282,145 Receivables and other assets 4,316 14,467 8,696 810 5,238 16,060 49,587 Total assets $ 1,297,711 $ 4,798,894 $ 234,066 $ 106,983 $ 1,251,832 $ 16,912 $ 7,706,398 Residential collateralized debt obligations $ — $ — $ — $ 102,597 $ — $ — $ 102,597 Multi-family collateralized debt obligations, at fair value 1,193,483 4,607,016 — — 1,181,314 — 6,981,813 Securitized debt 27,961 55,751 160,304 — — — 244,016 Accrued expenses and other liabilities 4,296 14,148 287 17 5,238 74 24,060 Total liabilities $ 1,225,740 $ 4,676,915 $ 160,591 $ 102,614 $ 1,186,552 $ 74 $ 7,352,486 (1) The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization ( see Note 6 ). (2) The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations ( see Note 6 ). One of the Company’s Freddie Mac-sponsored multi-family K-Series securitizations included in the Consolidated K-Series is not subject to any financing as of June 30, 2016 . (3) The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to a securitization transaction that closed in April 2016 that involved the issuance of $177.5 million of Class A Notes representing the beneficial ownership in a pool of performing and re-performing seasoned mortgage loans having an aggregate principal balance of approximately $282.8 million. The Company holds 5% of the Class A Notes issued as part of the securitization transaction. The Company has repaid the outstanding notes from its distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013 as of June 30, 2016. In connection with the repayment of the notes from the Company's distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013, the Company terminated and deconsolidated the Financing VIE that facilitated these financing transactions and the distressed residential loans serving as collateral on the notes were transferred back to the Company. |
Derivative Instruments and He35
Derivative Instruments and Hedging Activities (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Schedule of Activity of Derivative Instruments Not Designated as Hedges | The tables below summarize the activity of derivative instruments not designated as hedges for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Notional Amount For the Six Months Ended June 30, 2016 Derivatives Not Designated as Hedging Instruments December 31, 2015 Additions Settlement, Expiration or Exercise June 30, 2016 TBA securities $ 222,000 $ 1,952,000 $ (1,893,000 ) $ 281,000 U.S. Treasury futures — 117,700 (78,000 ) 39,700 Interest rate swap futures (137,200 ) 546,600 (477,300 ) (67,900 ) Eurodollar futures (2,769,000 ) 1,640,000 (3,095,000 ) (4,224,000 ) Options on U.S. Treasury futures 28,000 66,000 (64,000 ) 30,000 Swaptions 159,000 — (5,000 ) 154,000 Interest rate swaps 10,000 5,000 — 15,000 Notional Amount For the Six Months Ended June 30, 2015 Derivatives Not Designated as Hedging Instruments December 31, 2014 Additions Settlement, Expiration or Exercise June 30, 2015 TBA securities $ 273,000 $ 2,176,000 $ (2,153,000 ) $ 296,000 U.S. Treasury futures 2,300 123,600 (135,400 ) (9,500 ) Interest rate swap futures (190,100 ) 597,800 (605,000 ) (197,300 ) Eurodollar futures (2,961,000 ) 1,463,000 (1,453,000 ) (2,951,000 ) Options on U.S. Treasury futures 21,000 187,000 (201,000 ) 7,000 Swaptions 180,000 9,000 — 189,000 Interest rate swaps 10,000 — — 10,000 |
Schedule of Components of Realized and Unrealized Gains and Losses of Derivative Not Designated as Hedging Instruments | The following tables present the components of realized and unrealized gains and losses related to our derivative instruments that were not designated as hedging instruments included in other income (expense) in our condensed consolidated statements of operations for the three and six months ended June 30, 2016 and 2015 (dollar amounts in thousands): Three Months Ended June 30, 2016 2015 Realized Gains (Losses) Unrealized Gains (Losses) Realized Gains (Losses) Unrealized Gains (Losses) TBA Securities $ 3,700 $ 1,454 $ (2,243 ) $ (2,749 ) Eurodollar futures (1) (724 ) (1,294 ) (1,032 ) 185 Interest rate swaps — 93 — 90 Swaptions — 150 — 516 U.S. Treasury and Interest rate swap futures and options (724 ) 923 (1,167 ) 1,350 Total $ 2,252 $ 1,326 $ (4,442 ) $ (608 ) |
Schedule of Derivative Instruments Designated as Hedging Instruments and Location in Condensed Consolidated Balance Sheet | The following table presents the fair value of derivative instruments designated as hedging instruments and their location in the Company’s condensed consolidated balance sheets at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): Derivatives Designated as Hedging Instruments Balance Sheet Location Total Notional Amount June 30, 2016 December 31, 2015 Interest Rate Swaps Derivative liability $ 215,000 $ 823 $ — Interest Rate Swaps Derivative asset 350,000 — 304 |
Schedule of Derivative Instruments, Effect on Accumulated Other Comprehensive Income | The following table presents the impact of the Company’s derivative instruments on the Company’s accumulated other comprehensive income for the six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Six Months Ended June 30, Derivatives Designated as Hedging Instruments 2016 2015 Accumulated other comprehensive income for derivative instruments: Balance at beginning of the period $ 304 $ 1,135 Unrealized loss on interest rate swaps (1,127 ) (1,163 ) Balance at end of the period $ (823 ) $ (28 ) |
Schedule of Interest Rate Swaps Designated as Hedging Instruments | The following table details the impact of the Company’s interest rate swaps designated as hedging instruments included in interest expense for the three and six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Interest income Interest expense-investment securities $ 209 $ 439 $ 427 $ 890 |
Schedule of Interest Rate Swaps, Variable and Fixed Interest Rates | The following table presents information about our interest rate swaps (includes interest rate swaps in our Agency IO portfolio) whereby we receive floating rate payments in exchange for fixed rate payments as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Swap Maturities Notional Amount Weighted Average Fixed Interest Rate Weighted Average Notional Amount Weighted Average Fixed Interest Rate Weighted Average 2017 $ 215,000 0.83 % 0.45 % $ 215,000 0.83 % 0.39 % 2019 10,000 2.25 % 0.64 % 10,000 2.25 % 0.59 % Total $ 225,000 0.90 % 0.46 % $ 225,000 0.90 % 0.40 % The following table presents information about our interest rate swaps in our Agency IO portfolio whereby we receive fixed rate payments in exchange for floating rate payments as of June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Swap Maturities Notional Weighted Average Weighted Average Notional Weighted Average Weighted Average 2026 $ 5,000 1.80 % 0.62 % $ — — % — % Total $ 5,000 1.80 % 0.62 % $ — — % — % |
Not Designated as Hedging Instrument | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Schedule of Derivative Instruments | The following table presents the fair value of derivative instruments that were not designated as hedging instruments and their location in our condensed consolidated balance sheets at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): Derivatives Not Designated Balance Sheet Location June 30, 2016 December 31, 2015 TBA securities Derivative assets $ 290,318 $ 226,929 U.S. Treasury futures Derivative assets 1,002 — Options on U.S. Treasury futures Derivative assets 27 15 Interest rate swap futures Derivative assets — 706 Swaptions Derivative assets 333 821 Eurodollar futures Derivative liabilities 4,572 1,242 Interest rate swap futures Derivative liabilities 759 — Interest rate swaps (1) Derivative liabilities 284 258 (1) Includes interest rate swaps in our Agency IO portfolio. Contracts in a liability position of $0.5 million have been netted against the asset position of $0.2 million in the accompanying condensed consolidated balance sheets at June 30, 2016 . There was no netting of interest rate swaps at December 31, 2015 . |
Financing Arrangements, Portf36
Financing Arrangements, Portfolio Investments (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Banking and Thrift [Abstract] | |
Schedule of Borrowings Under Financing Arrangements and Assets Pledged as Collateral | The following table presents detailed information about the Company’s borrowings under financing arrangements and associated assets pledged as collateral at June 30, 2016 and December 31, 2015 (dollar amounts in thousands): June 30, 2016 December 31, 2015 Outstanding Financing Arrangements Fair Value of Collateral Pledged Amortized Cost of Collateral Pledged Outstanding Financing Arrangements (1) Fair Value of Collateral Pledged Amortized Cost of Collateral Pledged Agency ARMs $ 119,830 $ 126,497 $ 126,469 $ 227,609 $ 141,585 $ 143,754 Agency Fixed Rate 329,740 347,449 351,450 261,644 374,691 386,853 Agency IOs/U.S. Treasury Securities 76,028 104,335 117,310 88,160 123,407 139,218 Non Agency/CMBS 92,452 122,536 121,985 — — — Balance at end of the period $ 618,050 $ 700,817 $ 717,214 $ 577,413 $ 639,683 $ 669,825 (1) Includes FHLBI advances amounting to $121.0 million as of December 31, 2015. |
Schedule of Contractual Maturities of Outstanding Financing Arrangements | The following table presents contractual maturity information about the Company’s outstanding financing arrangements, at June 30, 2016 and December 31, 2015 (dollar amounts in thousands): Contractual Maturity June 30, 2016 December 31, 2015 Within 30 days $ 566,447 $ 468,402 Over 30 days to 90 days 51,603 85,423 Over 90 days — 23,588 Total $ 618,050 $ 577,413 |
Subordinated Debentures (Tables
Subordinated Debentures (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Subordinated Borrowings [Abstract] | |
Schedule of Subordinated Borrowing | The following table summarizes the key details of the Company’s subordinated debentures as of June 30, 2016 and December 31, 2015 (dollar amounts in thousands): NYM Preferred Trust I NYM Preferred Trust II Principal value of trust preferred securities $ 25,000 $ 20,000 Interest Rate Three month LIBOR plus 3.75%, resetting quarterly Three month LIBOR plus 3.95%, resetting quarterly Scheduled maturity March 30, 2035 October 30, 2035 |
Fair Value of Financial Instr38
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value on a Recurring Basis | The following table presents the Company’s financial instruments measured at fair value on a recurring basis as of June 30, 2016 and December 31, 2015 , respectively, on the Company’s condensed consolidated balance sheets (dollar amounts in thousands): Measured at Fair Value on a Recurring Basis at June 30, 2016 December 31, 2015 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets carried at fair value Investment securities available for sale: Agency RMBS $ — $ 613,304 $ — $ 613,304 $ — $ 713,116 $ — $ 713,116 Non-Agency RMBS — 110,371 — 110,371 — 1,567 — 1,567 U.S. Treasury Securities 7,997 — — 7,997 10,037 — — 10,037 CMBS — 22,546 42,271 64,817 — — 40,734 40,734 Multi-family loans held in securitization trusts — — 7,282,145 7,282,145 — — 7,105,336 7,105,336 Derivative assets: TBA Securities — 290,318 — 290,318 — 226,929 — 226,929 Options on U.S. Treasury futures 27 — — 27 15 — — 15 U.S. Treasury futures 1,002 — — 1,002 — — — — Interest rate swap futures — — — — 706 — — 706 Interest rate swaps — — — — — 304 — 304 Swaptions — 333 — 333 — 821 — 821 Investment in unconsolidated entities — — 63,055 63,055 — — 67,571 67,571 Total $ 9,026 $ 1,036,872 $ 7,387,471 $ 8,433,369 $ 10,758 $ 942,737 $ 7,213,641 $ 8,167,136 Liabilities carried at fair value Multi-family collateralized debt obligations $ — $ — $ 6,981,813 $ 6,981,813 $ — $ — $ 6,818,901 $ 6,818,901 Derivative liabilities: Eurodollar futures 4,572 — — 4,572 1,242 — — 1,242 Interest rate swaps 1,107 — 1,107 — 258 — 258 Interest rate swap futures 759 — — 759 — — — — Total $ 5,331 $ 1,107 $ 6,981,813 $ 6,988,251 $ 1,242 $ 258 $ 6,818,901 $ 6,820,401 |
Changes in Valuation of Level 3 Assets | The following table details changes in valuation for the Level 3 assets for the six months ended June 30, 2016 and 2015 , respectively (amounts in thousands): Level 3 Assets: Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 7,213,641 $ 8,442,604 Total gains/(losses) (realized/unrealized) Included in earnings (1) 240,755 (12,863 ) Included in other comprehensive income 124 422 Sales (2) — (1,073,029 ) Transfers in (3) 52,176 — Transfers out (4) (56,756 ) — Contributions 1,500 12,701 Paydowns (58,993 ) (38,475 ) Distributions (4,976 ) (382 ) Balance at the end of period $ 7,387,471 $ 7,330,978 (1) Amounts included in interest income from multi-family loans held in securitization trusts, unrealized gain on multi-family loans and debt held in securitization trusts, realized gain (loss) on investment securities and related hedges, gain on de-consolidation, and other income. (2) In February 2015, the Company sold a first loss PO security from one of the Company’s Consolidated K-Series securitizations obtaining total proceeds of approximately $44.3 million and realizing a gain of approximately $1.5 million . The sale resulted in a de-consolidation of $1.1 billion in multi-family loans held in a securitization trust and $1.0 billion in Multi-Family CDOs. (3) Transfers into Level 3 are investments in unconsolidated entities held by RiverBanc and RBMI for which the Company accounts under the equity method of accounting with a fair value election. These transfers in are a result of the Company’s acquisition of the outstanding membership interests in RiverBanc and RBMI that were not previously owned by the Company on May 16, 2016, which resulted in consolidation of these entities into the Company's financial statements. ( see Note 19 ). (4) Transfers out of Level 3 are the Company’s previously held membership interests in RBMI and RBDHC that were accounted for under the equity method of accounting with a fair value election. These transfers out are a result of the Company’s acquisition of the outstanding membership interests in RBMI and RBDHC that were not previously owned by the Company on May 16, 2016, which resulted in consolidation of these entities into the Company's financial statements. ( see Note 19 ). |
Changes in Valuation of Level 3 Liabilities | The following table details changes in valuation for the Level 3 liabilities for the six months ended June 30, 2016 and 2015 , respectively (amounts in thousands): Level 3 Liabilities: Six Months Ended June 30, 2016 2015 Balance at beginning of period $ 6,818,901 $ 8,048,053 Total gains/(losses) (realized/unrealized) Included in earnings (1) 221,899 (46,999 ) Sales (2) — (1,031,268 ) Paydowns (58,987 ) (37,694 ) Balance at the end of period $ 6,981,813 $ 6,932,092 (1) Amounts included in interest expense on Multi-Family CDOs, realized gain (loss) on investment securities and related hedges and unrealized gain on multi-family loans and debt held in securitization trusts. (2) In February 2015, the Company sold a first loss PO security from one of the Company’s Consolidated K-Series securitizations obtaining total proceeds of approximately $44.3 million and realizing a gain of approximately $1.5 million . The sale resulted in a de-consolidation of $1.1 billion in multi-family loans held in a securitization trust and $1.0 billion in Multi-Family CDOs. |
Changes in Unrealized Gains (Losses) Included in Earnings for Level 3 Assets and Liabilities | The following table details the changes in unrealized gains (losses) included in earnings for our Level 3 Multi-family loans and debt held in securitization trusts for the three and six months ended June 30, 2016 and 2015 , respectively (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Change in unrealized gains (losses)– assets $ 65,763 $ (136,701 ) $ 255,656 $ (305 ) Change in unrealized (losses) gains – liabilities (64,979 ) 142,119 (254,054 ) 19,351 Net change in unrealized gains included in earnings for assets and liabilities $ 784 $ 5,418 $ 1,602 $ 19,046 |
Schedule of Assets Measured at Fair Value on a Non-recurring Basis | The following table presents assets measured at fair value on a non-recurring basis as of June 30, 2016 and December 31, 2015 , respectively, on the condensed consolidated balance sheets (dollar amounts in thousands): Assets Measured at Fair Value on a Non-Recurring Basis at June 30, 2016 December 31, 2015 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Residential mortgage loans held in securitization trusts – impaired loans (net) $ — $ — $ 9,044 $ 9,044 $ — $ — $ 8,976 $ 8,976 Real estate owned held in residential securitization trusts — — 72 72 — — 411 411 |
Schedule of Gains (Losses) Incurred for Assets Measured at Fair Value on a Non-recurring Basis | The following table presents gains (losses) incurred for assets measured at fair value on a non-recurring basis for the three and six months ended June 30, 2016 and 2015 , respectively, on the Company’s condensed consolidated statements of operations (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Residential mortgage loans held in securitization trusts – impaired loans (net) $ 163 $ (345 ) $ 432 $ (656 ) Real estate owned held in residential securitization trusts (225 ) — (23 ) 26 |
Schedule of Carrying Value and Estimated Fair Value of Financial Instruments | The following table presents the carrying value and estimated fair value of the Company’s financial instruments at June 30, 2016 and December 31, 2015 , respectively (dollar amounts in thousands): June 30, 2016 December 31, 2015 Fair Value Hierarchy Level Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Financial Assets: Cash and cash equivalents Level 1 $ 49,941 $ 49,941 $ 61,959 $ 61,959 Investment securities available for sale (1) Level 1, 2 or 3 796,489 796,489 765,454 765,454 Residential mortgage loans held in securitization trusts (net) Level 3 106,173 93,314 119,921 109,120 Distressed residential mortgage loans (net) (2) Level 3 543,361 544,858 558,989 564,310 Multi-family loans held in securitization trusts Level 3 7,282,145 7,282,145 7,105,336 7,105,336 Derivative assets Level 1 or 2 291,680 291,680 228,775 228,775 Mortgage loans held for sale (net) (3) Level 3 5,283 5,328 5,471 5,557 Mortgage loans held for investment (3) Level 3 10,391 10,531 2,706 2,846 Mezzanine loan and preferred equity investments (4) Level 3 75,300 76,004 44,151 44,540 Investment in unconsolidated entities (5) Level 3 73,839 74,304 87,662 87,558 Financial Liabilities: Financing arrangements, portfolio investments Level 2 $ 618,050 $ 618,050 $ 577,413 $ 577,413 Financing arrangements, residential mortgage loans Level 2 174,798 174,798 212,155 212,155 Residential collateralized debt obligations Level 3 102,597 92,522 116,710 105,606 Multi-family collateralized debt obligations Level 3 6,981,813 6,981,813 6,818,901 6,818,901 Securitized debt Level 3 244,016 252,252 116,541 123,776 Derivative liabilities Level 1 or 2 6,438 6,438 1,500 1,500 Payable for securities purchased Level 1 286,452 286,452 227,969 227,969 Subordinated debentures Level 3 45,000 44,081 45,000 42,731 (1) Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015 , respectively. (2) Includes distressed residential mortgage loans held in securitization trusts with a carrying value amounting to approximately $225.4 million and $114.2 million at June 30, 2016 and December 31, 2015 , respectively, and distressed residential mortgage loans with a carrying value amounting to approximately $318.0 million and $444.8 million at June 30, 2016 and December 31, 2015 , respectively. (3) Included in receivables and other assets in the accompanying condensed consolidated balance sheets. (4) Includes mezzanine loan and preferred equity investments accounted for as loans ( see Note 2 ). (5) Includes investments in unconsolidated entities accounted for under the fair value option with a carrying value of $63.1 million and $67.6 million at June 30, 2016 and December 31, 2015 , respectively. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Preferred Stock | |
Class of Stock [Line Items] | |
Schedule of Dividends Declared | The following table presents the relevant dates with respect to quarterly cash dividends on the Series B Preferred Stock from January 1, 2015 through June 30, 2016 and cash dividends on Series C Preferred Stock from issuance through June 30, 2016 : Series B Preferred Stock Series C Preferred Stock Declaration Date Record Date Payment Date Cash Dividend Per Share Declaration Date Record Date Payment Date Cash Dividend Per Share June 16, 2016 July 1, 2016 July 15, 2016 $ 0.484375 June 16, 2016 July 1, 2016 July 15, 2016 $ 0.4921875 March 18, 2016 April 1, 2016 April 15, 2016 0.484375 March 18, 2016 April 1, 2016 April 15, 2016 0.4921875 December 16, 2015 January 1, 2016 January 15, 2016 0.484375 December 16, 2015 January 1, 2016 January 15, 2016 0.4921875 September 18, 2015 October 1, 2015 October 15, 2015 0.484375 September 18, 2015 October 1, 2015 October 15, 2015 0.4921875 June 18, 2015 July 1, 2015 July 15, 2015 0.484375 June 18, 2015 July 1, 2015 July 15, 2015 0.4539100 (1) March 18, 2015 April 1, 2015 April 15, 2015 0.484375 — — — — (1) Cash dividend for the partial quarterly period that began on April 22, 2015 and ended on July 14, 2015. |
Common Stock | |
Class of Stock [Line Items] | |
Schedule of Dividends Declared | The following table presents cash dividends declared by the Company on its common stock with respect to each of the quarterly periods commencing January 1, 2015 and ended June 30, 2016 : Period Declaration Date Record Date Payment Date Cash Dividend Per Share Second Quarter 2016 June 16, 2016 June 27, 2016 July 25, 2016 $ 0.24 First Quarter 2016 March 18, 2016 March 28, 2016 April 25, 2016 0.24 Fourth Quarter 2015 December 16, 2015 December 28, 2015 January 25, 2016 0.24 Third Quarter 2015 September 18, 2015 September 28, 2015 October 26, 2015 0.24 Second Quarter 2015 June 18, 2015 June 29, 2015 July 27, 2015 0.27 First Quarter 2015 March 18, 2015 March 30, 2015 April 27, 2015 0.27 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Dilutive Net Income Per Share | The following table presents the computation of basic and dilutive net income per share for the periods indicated (dollar amounts in thousands, except per share amounts): For the Three Months Ended For the Six Months Ended 2016 2015 2016 2015 Numerator : Net income attributable to Company's common stockholders– Basic $ 11,210 $ 21,544 $ 24,936 $ 43,634 Net income attributable to Company's common stockholders– Dilutive $ 11,210 $ 21,544 $ 24,936 $ 43,634 Denominator: Weighted average basic and diluted shares outstanding 109,489 109,252 109,445 107,380 EPS: Basic EPS $ 0.10 $ 0.20 $ 0.23 $ 0.41 Dilutive EPS $ 0.10 $ 0.20 $ 0.23 $ 0.41 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Restricted Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Restricted Stock Activity | A summary of the activity of the Company's non-vested restricted stock under the 2010 Plan for the six months ended June 30, 2016 and 2015 , respectively, is presented below: 2016 2015 Number of Non-vested Restricted Shares Weighted Average Per Share Grant Date Fair Value (1) Number of Non-vested Restricted Shares Weighted Average Per Share Grant Date Fair Value (1) Non-vested shares at January 1 280,457 $ 7.63 162,171 $ 7.26 Granted 160,453 5.11 185,650 7.79 Vested (121,852 ) 7.54 (67,364 ) 7.18 Non-vested shares as of June 30 319,058 $ 6.40 280,457 $ 7.63 Weighted-average fair value of restricted stock granted during the period 160,453 $ 5.11 185,650 $ 7.79 (1) The grant date fair value of restricted stock awards is based on the closing market price of the Company’s common stock at the grant date. |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Provision | The income tax provision for the three and six months ended June 30, 2016 and June 30, 2015 is comprised of the following components (dollar amounts in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Current income tax expense $ 2,183 $ 955 $ 2,255 $ 1,989 Deferred income tax expense (benefit) 183 223 302 (567 ) Total provision $ 2,366 $ 1,178 $ 2,557 $ 1,423 |
Schedule of Deferred Tax Assets and Liabilities | The major sources of temporary differences included in the deferred tax assets and their deferred tax effect as of June 30, 2016 and December 31, 2015 are as follows (dollar amounts in thousands): June 30, 2016 December 31, 2015 Deferred tax assets Net operating loss carryforward $ 2,268 $ 2,083 Net capital loss carryforward 754 2,029 GAAP/Tax basis differences 2,874 3,043 Total deferred tax assets (1) $ 5,896 $ 7,155 Deferred tax liabilities Deferred tax liabilities $ 1,702 $ 192 Total deferred tax liabilities (2) 1,702 192 Valuation allowance (1) (4,170 ) (6,457 ) Total net deferred tax asset $ 24 $ 506 (1) Included in receivables and other assets in the accompanying condensed consolidated balance sheets. (2) Included in accrued expenses and other liabilities in the accompanying condensed consolidated balance sheets. |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed by the Company at the Acquisition Date (dollar amounts in thousands). The membership interest purchase agreement for the acquisition of RiverBanc included a post-closing working capital adjustment to be calculated and settled with the sellers of RiverBanc after the Acquisition Date. Additionally, the excess severance holdback amount described above will be settled with the sellers of RiverBanc after the Acquisition Date. The Company has also engaged a third party for valuations of certain intangible assets. Thus, the provisional measurements of assets and liabilities are subject to change. Cash $ 4,325 Investment in unconsolidated entities 52,176 Mezzanine loan and preferred equity investments 23,638 Real estate under development (1) 14,922 Receivables and other assets 911 Intangible assets (1) 3,910 Total identifiable assets acquired $ 99,882 Construction loan payable (2) $ 8,499 Accrued expenses and other liabilities 2,864 Total liabilities assumed $ 11,363 Preferred equity (3) $ 56,697 Net identifiable assets acquired $ 31,822 Goodwill (4) $ 24,782 Gain on bargain purchase (5) (65 ) Non-controlling interest (6) (3,078 ) Net assets acquired $ 53,461 (1) Included in receivables and other assets on the condensed consolidated balance sheets. (2) Construction loan payable to the Company is eliminated on the condensed consolidated balance sheets. (3) Includes $40.4 million of preferred equity owned by the Company that is eliminated on the condensed consolidated balance sheets. Remaining $16.3 million of preferred equity owned by third parties was redeemed in the period ended June 30, 2016. (4) Goodwill recognized in the acquisition of RiverBanc. (5) Gain on bargain purchase recognized in the acquisitions of RBMI and RBDHC. (6) Represents third-party ownership of KRVI membership interests ( see Note 7 ). The Company consolidates its investment in KRVI. The third-party ownership in KRVI is represented in the condensed consolidated financial statements and the pro forma net income attributable to the Company's common stockholders as non-controlling interests. The fair value of the non-controlling interests in KRVI is estimated to be $3.1 million. The fair value of the non-controlling interests in KRVI, a private company, was estimated using assumptions for the timing and amount of expected future cash flow for income and realization events for the underlying real estate. |
Schedule of Fair Value of Consideration Transferred | The estimated Acquisition Date fair value of the consideration transferred totaled $53.5 million, which consisted of the following (dollar amounts in thousands): Cash (1) $ 29,053 Contingent consideration 3,800 Fair value of previously held membership interests 20,608 Total consideration transferred $ 53,461 (1) Includes $16.3 million paid to Donlon Family LLC. |
Pro Forma Information | The following represents the pro forma consolidated revenue and net income attributable to the Company's common stockholders as if the Acquirees had been included in the consolidated results of the Company for the six months ended June 30, 2016 and 2015, respectively (dollar amounts in thousands): For the Six Months Ended June 30, 2016 2015 Revenue $ 175,923 $ 207,011 Net income attributable to Company's common stockholders $ 21,897 $ 49,269 Basic pro forma income per share $ 0.20 $ 0.46 Diluted pro forma income per share $ 0.20 $ 0.46 |
Summary of Significant Accoun44
Summary of Significant Accounting Policies - Narrative (Details) | May 16, 2016 | May 31, 2015 | Jun. 30, 2016USD ($)securitization | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)segmentsecuritization | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($)securitization |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Goodwill | $ 24,782,000 | $ 24,782,000 | $ 0 | ||||
Residential mortgage loans, delinquency period | 90 days | ||||||
Restricted cash | 55,700,000 | $ 55,700,000 | 20,800,000 | ||||
Interest receivable | 23,600,000 | 23,600,000 | 24,600,000 | ||||
Deferred finance costs, gross | 1,800,000 | 1,800,000 | 1,000,000 | ||||
Employer contributions | 100,000 | $ 0 | $ 100,000 | $ 0 | |||
Number of operating segments | segment | 1 | ||||||
Number of reportable segments | segment | 1 | ||||||
Held in Agency IO Portfolio for Trading Purposes | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Restricted cash | 39,700,000 | $ 39,700,000 | 11,600,000 | ||||
Held by Counterparties as Collateral for Hedging Instruments | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Restricted cash | 10,600,000 | 10,600,000 | 8,200,000 | ||||
Distressed Residential Mortgage Loans | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Deferred finance costs, gross | $ 1,400,000 | $ 1,400,000 | $ 2,300,000 | ||||
Consolidated K-Series | K-Series | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Number of securitizations | securitization | 5 | 5 | 5 | ||||
Receivables and Other Assets | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Real estate under development | $ 15,600,000 | $ 15,600,000 | $ 0 | ||||
Equity method investment | 10,700,000 | 10,700,000 | 20,100,000 | ||||
Receivables and Other Assets | Real Estate Loan | Mezzanine Loan and Preferred Equity Investments | Residential | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Financing receivable, net | 75,300,000 | 75,300,000 | 44,200,000 | ||||
Equity Method Investments | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Equity method investment | 63,100,000 | 63,100,000 | 67,600,000 | ||||
Equity Method Investments | Receivables and Other Assets | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Equity method investment | $ 63,100,000 | $ 63,100,000 | $ 67,600,000 | ||||
Minimum | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Finite-Lived Intangible Asset, Useful Life | 1 year | ||||||
Repurchase agreements, expiration period | 12 months | ||||||
Maximum | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||||||
Repurchase agreements, expiration period | 15 months | ||||||
Performance Share Awards | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Award vesting period | 3 years |
Summary of Significant Accoun45
Summary of Significant Accounting Policies - Investments in Unconsolidated Entities (Details) - Equity Method Investments - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Schedule of Equity Method Investments [Line Items] | |||||
Equity method investment | $ 63,100,000 | $ 63,100,000 | $ 67,600,000 | ||
RB Development Holding Company, LLC (1) (RBDHC) | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 0.00% | 0.00% | 63.00% | ||
Income (loss) from investments | $ 0 | $ (27,000) | $ 107,000 | $ 8,000 | |
Equity method investment | $ 0 | $ 0 | $ 1,927,000 | ||
RB Multifamily Investors LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 0.00% | 0.00% | 70.00% | ||
Income (loss) from investments | $ 1,000 | 1,680,000 | $ 2,262,000 | 2,827,000 | |
Equity method investment | $ 0 | $ 0 | $ 56,891,000 | ||
Morrocroft Neighborhood Stabilization Fund II, LP | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 11.00% | 11.00% | 13.00% | ||
Income (loss) from investments | $ 234,000 | 0 | $ 591,000 | 9,000 | |
Equity method investment | $ 10,579,000 | $ 10,579,000 | $ 8,753,000 | ||
Evergreens JV Holdings, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 85.00% | 85.00% | 0.00% | ||
Income (loss) from investments | $ 10,000 | 0 | $ 10,000 | 0 | |
Equity method investment | $ 3,700,000 | $ 3,700,000 | $ 0 | ||
Bent Tree JV Holdings, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 78.00% | 78.00% | 0.00% | ||
Income (loss) from investments | $ 100,000 | 0 | $ 100,000 | 0 | |
Equity method investment | $ 9,780,000 | $ 9,780,000 | $ 0 | ||
Summerchase LR Partners LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 80.00% | 80.00% | 0.00% | ||
Income (loss) from investments | $ 10,000 | 0 | $ 10,000 | 0 | |
Equity method investment | $ 4,360,000 | $ 4,360,000 | $ 0 | ||
Lake Mary Realty Partners, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 80.00% | 80.00% | 0.00% | ||
Income (loss) from investments | $ 20,000 | 0 | $ 20,000 | 0 | |
Equity method investment | $ 10,350,000 | $ 10,350,000 | $ 0 | ||
The Preserve at Port Royal Venture, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 77.00% | 77.00% | 0.00% | ||
Income (loss) from investments | $ 100,000 | 0 | $ 100,000 | 0 | |
Equity method investment | $ 11,910,000 | $ 11,910,000 | $ 0 | ||
WR Savannah Holdings, LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 90.00% | 90.00% | 0.00% | ||
Income (loss) from investments | $ 60,000 | $ 0 | $ 60,000 | 0 | |
Equity method investment | $ 12,340,000 | $ 12,340,000 | $ 0 | ||
RB Distressed Investors LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership Interest | 9.00% | 9.00% | 0.00% | ||
Income (loss) from investments | $ 0 | $ 0 | $ 0 | ||
Equity method investment | $ 36,000 | $ 36,000 | $ 0 |
Investment Securities Availab46
Investment Securities Available for Sale - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Proceeds from sales of investment securities | $ 117,100,000 | $ 34,500,000 | $ 177,900,000 | |
Realized gain (loss) on sales of investment securities available for sale | $ (500,000) | (900,000) | $ 3,200,000 | |
Contractual maturities of available for sale securities | 30 years | |||
Weighted average life of available for sale securities portfolio | 3 years 354 days | 5 years | ||
Other-than-temporary impairment recorded in earnings | $ 0 | $ 0 | $ 0 | $ 0 |
Investment Securities Availab47
Investment Securities Available for Sale - (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | $ 807,179 | $ 784,998 | |
Unrealized Gains | 17,792 | 13,943 | |
Unrealized Losses | (28,482) | (33,487) | |
Fair Value | [1] | 796,489 | 765,454 |
Available-for-sale securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Assets held in securitization trusts | 42,271 | 40,734 | |
Agency ARMs | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 134,398 | 175,160 |
Unrealized Gains | [2] | 650 | 217 |
Unrealized Losses | [2] | (578) | (2,364) |
Fair Value | [2] | 134,470 | 173,013 |
Agency ARMs | Freddie Mac | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 44,256 | 62,383 |
Unrealized Gains | [2] | 254 | 41 |
Unrealized Losses | [2] | (149) | (770) |
Fair Value | [2] | 44,361 | 61,654 |
Agency ARMs | Fannie Mae | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 83,028 | 92,605 |
Unrealized Gains | [2] | 396 | 121 |
Unrealized Losses | [2] | (197) | (1,334) |
Fair Value | [2] | 83,227 | 91,392 |
Agency ARMs | Ginnie Mae | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 7,114 | 20,172 |
Unrealized Gains | [2] | 0 | 55 |
Unrealized Losses | [2] | (232) | (260) |
Fair Value | [2] | 6,882 | 19,967 |
Agency Fixed Rate | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 377,046 | 437,683 |
Unrealized Gains | [2] | 144 | 9 |
Unrealized Losses | [2] | (4,366) | (12,979) |
Fair Value | [2] | 372,824 | 424,713 |
Agency Fixed Rate | Freddie Mac | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 27,992 | 31,076 |
Unrealized Gains | [2] | 5 | 0 |
Unrealized Losses | [2] | (165) | (719) |
Fair Value | [2] | 27,832 | 30,357 |
Agency Fixed Rate | Fannie Mae | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 348,547 | 380,684 |
Unrealized Gains | [2] | 139 | 0 |
Unrealized Losses | [2] | (4,198) | (12,149) |
Fair Value | [2] | 344,488 | 368,535 |
Agency Fixed Rate | Ginnie Mae | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 507 | 25,923 |
Unrealized Gains | [2] | 0 | 9 |
Unrealized Losses | [2] | (3) | (111) |
Fair Value | [2] | 504 | 25,821 |
Agency IOs | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 125,130 | 131,623 |
Unrealized Gains | [2] | 4,100 | 1,624 |
Unrealized Losses | [2] | (23,220) | (17,857) |
Fair Value | [2] | 106,010 | 115,390 |
Agency IOs | Freddie Mac | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 23,185 | 28,970 |
Unrealized Gains | [2] | 628 | 680 |
Unrealized Losses | [2] | (5,076) | (4,471) |
Fair Value | [2] | 18,737 | 25,179 |
Agency IOs | Fannie Mae | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 37,709 | 39,603 |
Unrealized Gains | [2] | 1,052 | 433 |
Unrealized Losses | [2] | (8,783) | (6,341) |
Fair Value | [2] | 29,978 | 33,695 |
Agency IOs | Ginnie Mae | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 64,236 | 63,050 |
Unrealized Gains | [2] | 2,420 | 511 |
Unrealized Losses | [2] | (9,361) | (7,045) |
Fair Value | [2] | 57,295 | 56,516 |
Agency RMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 636,574 | 744,466 |
Unrealized Gains | [2] | 4,894 | 1,850 |
Unrealized Losses | [2] | (28,164) | (33,200) |
Fair Value | [2] | 613,304 | 713,116 |
Non-Agency RMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 110,349 | 1,727 | |
Unrealized Gains | 280 | 51 | |
Unrealized Losses | (258) | (211) | |
Fair Value | 110,371 | 1,567 | |
U.S. Treasury securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [2] | 7,982 | 10,113 |
Unrealized Gains | [2] | 15 | 0 |
Unrealized Losses | [2] | 0 | (76) |
Fair Value | [2] | 7,997 | 10,037 |
CMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | [3] | 52,274 | 28,692 |
Unrealized Gains | [3] | 12,603 | 12,042 |
Unrealized Losses | [3] | (60) | 0 |
Fair Value | [3] | 64,817 | 40,734 |
CMBS | Available-for-sale securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Assets held in securitization trusts | $ 42,300 | $ 40,700 | |
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. | ||
[2] | Included in investment securities available for sale are Agency IOs, Agency RMBS and U.S. Treasury securities managed by Midway that are measured at fair value through earnings. | ||
[3] | Included in CMBS is $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. |
Investment Securities Availab48
Investment Securities Available for Sale - Weighted Average Lives for Available-for-Sale Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |||
0 to 5 years | $ 652,280 | $ 518,594 | |
Over 5 to 10 years | 141,421 | 219,747 | |
10 years | 2,788 | 27,113 | |
Total | [1] | $ 796,489 | $ 765,454 |
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. |
Investment Securities Availab49
Investment Securities Available for Sale - Stated Reset Periods (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | [1] | $ 796,489 | $ 765,454 |
Less than 6 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 102,919 | 102,918 | |
6 to 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 29,767 | 46,079 | |
More than 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 663,803 | 616,457 | |
Agency RMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | [2] | 613,304 | 713,116 |
Agency RMBS | Less than 6 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 71,056 | 92,693 | |
Agency RMBS | 6 to 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 29,767 | 44,700 | |
Agency RMBS | More than 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 512,481 | 575,723 | |
Non-Agency RMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 110,371 | 1,567 | |
Non-Agency RMBS | Less than 6 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 1,320 | 188 | |
Non-Agency RMBS | 6 to 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 0 | 1,379 | |
Non-Agency RMBS | More than 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 109,051 | 0 | |
U.S. Treasury securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | [2] | 7,997 | 10,037 |
U.S. Treasury securities | Less than 6 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 7,997 | 10,037 | |
U.S. Treasury securities | 6 to 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 0 | 0 | |
U.S. Treasury securities | More than 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 0 | 0 | |
CMBS | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | [3] | 64,817 | 40,734 |
CMBS | Less than 6 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 22,546 | 0 | |
CMBS | 6 to 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | 0 | 0 | |
CMBS | More than 24 months | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investment securities available for sale | $ 42,271 | $ 40,734 | |
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. | ||
[2] | Included in investment securities available for sale are Agency IOs, Agency RMBS and U.S. Treasury securities managed by Midway that are measured at fair value through earnings. | ||
[3] | Included in CMBS is $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. |
Investment Securities Availab50
Investment Securities Available for Sale - in an Unrealized Loss Position (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Carrying Value Less Than 12 Months | $ 35,861 | $ 72,358 |
Gross Unrealized Losses Less Than 12 Months | (213) | (688) |
Carrying Value Greater Than 12 Months | 375,294 | 476,953 |
Gross Unrealized Losses Greater Than 12 Months | (5,046) | (14,708) |
Carrying Value Total | 411,155 | 549,311 |
Gross Unrealized Losses Total | (5,259) | (15,396) |
Agency RMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Carrying Value Less Than 12 Months | 4,478 | 71,587 |
Gross Unrealized Losses Less Than 12 Months | (25) | (688) |
Carrying Value Greater Than 12 Months | 375,146 | 476,157 |
Gross Unrealized Losses Greater Than 12 Months | (4,916) | (14,497) |
Carrying Value Total | 379,624 | 547,744 |
Gross Unrealized Losses Total | (4,941) | (15,185) |
Non-Agency RMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Carrying Value Less Than 12 Months | 21,114 | 771 |
Gross Unrealized Losses Less Than 12 Months | (128) | 0 |
Carrying Value Greater Than 12 Months | 148 | 796 |
Gross Unrealized Losses Greater Than 12 Months | (130) | (211) |
Carrying Value Total | 21,262 | 1,567 |
Gross Unrealized Losses Total | (258) | $ (211) |
CMBS | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Carrying Value Less Than 12 Months | 10,269 | |
Gross Unrealized Losses Less Than 12 Months | (60) | |
Carrying Value Greater Than 12 Months | 0 | |
Gross Unrealized Losses Greater Than 12 Months | 0 | |
Carrying Value Total | 10,269 | |
Gross Unrealized Losses Total | $ (60) |
Residential Mortgage Loans He51
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned - Narrative (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016USD ($)loan | Dec. 31, 2015USD ($)loan | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Mortgage Loans on Real Estate [Line Items] | ||||
Allowance for loan losses | $ 3,732 | $ 3,399 | $ 4,092 | $ 3,631 |
Allowance for loan losses, basis points | 3.42% | 2.77% | ||
CDOs outstanding | $ 4,400 | $ 4,400 | ||
Residential Mortgage Loans Held in Securitization Trusts and Real Estate Owned Held in Residential Securitization | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Number of delinquent loans | loan | 30 | 31 | ||
Principal amount of delinquent loans | $ 12,400 | $ 18,000 | ||
Residential Mortgage Loans Held in Securitization Trusts and Real Estate Owned Held in Residential Securitization | Payment Deferral | ||||
Mortgage Loans on Real Estate [Line Items] | ||||
Principal amount of delinquent loans | $ 11,600 | $ 11,900 | ||
Delinquent loans under modified payment, percent | 94.00% | 67.00% |
Residential Mortgage Loans He52
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned - Mortgage Loans Held in Securitization Trusts (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Mortgage Loans on Real Estate [Abstract] | ||
Unpaid principal balance | $ 109,214 | $ 122,545 |
Deferred origination costs – net | 691 | 775 |
Reserve for loan losses | (3,732) | (3,399) |
Total | $ 106,173 | $ 119,921 |
Residential Mortgage Loans He53
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned - Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Allowance for Loan and Lease Losses [Roll Forward] | ||
Balance at beginning of period | $ 3,399 | $ 3,631 |
Provisions for loan losses | 409 | 656 |
Transfer to real estate owned | 0 | 1 |
Charge-offs | (76) | $ (196) |
Balance at the end of period | $ 3,732 |
Residential Mortgage Loans He54
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned - Real Estate Owned (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Reconciliation of Carrying Amount of Real Estate Investments [Roll Forward] | ||
Balance at beginning of period | $ 411 | $ 965 |
Write downs | 0 | 0 |
Transfer from/(to) mortgage loans held in securitization trusts | 0 | (192) |
Disposal | (339) | (362) |
Balance at the end of period | $ 72 | $ 411 |
Residential Mortgage Loans He55
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned - Past Due Loans (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016USD ($)loan | Dec. 31, 2015USD ($)loan | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Number of Delinquent Loans | loan | 1 | 3 |
Total Unpaid Principal | $ | $ 168 | $ 574 |
% of Loan Portfolio | 0.15% | 0.47% |
30 - 60 | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Number of Delinquent Loans | loan | 0 | 3 |
Total Unpaid Principal | $ | $ 0 | $ 825 |
% of Loan Portfolio | 0.00% | 0.67% |
61 - 90 | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Number of Delinquent Loans | loan | 1 | 2 |
Total Unpaid Principal | $ | $ 118 | $ 1,763 |
% of Loan Portfolio | 0.11% | 1.43% |
90 | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Number of Delinquent Loans | loan | 29 | 26 |
Total Unpaid Principal | $ | $ 12,277 | $ 15,365 |
% of Loan Portfolio | 11.22% | 12.48% |
Residential Mortgage Loans He56
Residential Mortgage Loans Held in Securitization Trusts (Net) and Real Estate Owned - Geographic Concentrations of Credit Risk (Details) - Geographic Concentration Risk - Residential Mortgage Loans Held in Securitization Trusts and Real Estate Owned Held in Residential Securitization | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
New York | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 35.20% | 35.60% |
Massachusetts | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 19.90% | 20.70% |
New Jersey | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 10.30% | 11.10% |
Florida | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 8.50% | 7.70% |
Connecticut | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 7.10% | 6.50% |
Maryland | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 5.10% | 4.90% |
Distressed Residential Mortga57
Distressed Residential Mortgage Loans - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Distressed residential mortgage loans held in securitization trust, (net) | ||
Mortgage Loans on Real Estate [Line Items] | ||
Loans, carrying value | $ 225,370 | $ 114,214 |
Distressed Residential Mortgage Loans | ||
Mortgage Loans on Real Estate [Line Items] | ||
Loans, carrying value | 543,400 | 559,000 |
Distressed Residential Mortgage Loans | Residential Mortgage | Deutsche Bank AG, Cayman Islands Branch | ||
Mortgage Loans on Real Estate [Line Items] | ||
Loans pledged as collateral, carrying value | $ 256,400 | $ 307,000 |
Distressed Residential Mortga58
Distressed Residential Mortgage Loans - (Details) - Distressed Residential Mortgage Loans - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Mortgage Loans on Real Estate [Line Items] | ||
Contractually required principal and interest | $ 88,907 | $ 70,630 |
Non-accretable yield | (7,470) | (3,997) |
Expected cash flows to be collected | 81,437 | 66,633 |
Accretable yield | (43,613) | (37,225) |
Fair value at the date of acquisition | $ 37,824 | $ 29,408 |
Distressed Residential Mortga59
Distressed Residential Mortgage Loans - Activity (Details) - Distressed Residential Mortgage Loans - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Movement in Mortgage Loans on Real Estate [Roll Forward] | ||
Balance at beginning of period | $ 579,009 | $ 640,416 |
Additions | 51,288 | 44,485 |
Disposals | (71,137) | (34,897) |
Accretion | (17,301) | (20,486) |
Balance at end of period | $ 541,859 | $ 629,518 |
Distressed Residential Mortga60
Distressed Residential Mortgage Loans - Geographic Concentrations of Credit Risk (Details) - Distressed residential mortgage loans held in securitization trust, (net) - Geographic Concentration Risk | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Florida | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 11.90% | 12.60% |
California | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 8.30% | 7.70% |
North Carolina | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 8.00% | 8.10% |
Georgia | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 6.10% | 6.10% |
Maryland | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 5.20% | 5.40% |
New York | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 5.00% | 5.20% |
Consolidated K-Series - Narrati
Consolidated K-Series - Narrative (Details) $ in Millions | Jun. 30, 2016USD ($)securitization | Dec. 31, 2015USD ($)securitization |
Multi-family collateralized debt obligations, at fair value | ||
Mortgage Loans on Real Estate [Line Items] | ||
Loans, unpaid principal balance | $ 6,800 | |
Weighted average interest rate | 4.11% | 3.98% |
Multi-family loans held in securitization trusts | ||
Mortgage Loans on Real Estate [Line Items] | ||
Loans, unpaid principal balance | $ 6,800 | $ 6,800 |
Consolidated K-Series | ||
Mortgage Loans on Real Estate [Line Items] | ||
K-Series, carrying value | $ 300.3 | $ 286.4 |
Consolidated K-Series | K-Series | ||
Mortgage Loans on Real Estate [Line Items] | ||
Number of securitizations | securitization | 5 | 5 |
Consolidated K-Series - Condens
Consolidated K-Series - Condensed Balance Sheet of Consolidated K-Series (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Assets | |||
Multi-family loans held in securitization trusts | $ 7,282,145 | $ 7,105,336 | |
Total Assets | [1] | 9,388,142 | 9,056,242 |
Liabilities and Equity | |||
Total liabilities | [1] | 8,521,099 | 8,175,716 |
Equity | 863,967 | 880,526 | |
Total Liabilities and Stockholders' Equity | 9,388,142 | 9,056,242 | |
Consolidated K-Series | |||
Assets | |||
Multi-family loans held in securitization trusts | 7,282,145 | 7,105,336 | |
Receivables | 23,618 | 24,579 | |
Total Assets | 7,305,763 | 7,129,915 | |
Liabilities and Equity | |||
Multi-family CDOs | 6,981,813 | 6,818,901 | |
Accrued expenses | 23,523 | 24,483 | |
Total liabilities | 7,005,336 | 6,843,384 | |
Equity | 300,427 | 286,531 | |
Total Liabilities and Stockholders' Equity | $ 7,305,763 | $ 7,129,915 | |
[1] | Our condensed consolidated balance sheets include assets and liabilities of consolidated variable interest entities ("VIEs") as the Company is the primary beneficiary of these VIEs. As of June 30, 2016 and December 31, 2015, assets of consolidated VIEs totaled $7,706,398 and $7,413,082, respectively, and the liabilities of consolidated VIEs totaled $7,352,486 and $7,077,175, respectively. See Note 7 for further discussion. |
Consolidated K-Series - Conde63
Consolidated K-Series - Condensed Statement of Operations of Consolidated K-Series (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Condensed Income Statements, Captions [Line Items] | ||||
Total interest income | $ 79,766 | $ 84,400 | $ 161,392 | $ 173,385 |
Interest expense | 3,962 | 3,442 | 7,811 | 6,905 |
Total interest expense | 63,102 | 64,097 | 127,086 | 131,481 |
NET INTEREST INCOME | 16,664 | 20,303 | 34,306 | 41,904 |
Unrealized gain on multi-family loans and debt held in securitization trusts, net | 784 | 5,418 | 1,602 | 19,046 |
NET INCOME ATTRIBUTABLE TO COMPANY | 14,435 | 24,631 | 31,386 | 48,174 |
Consolidated K-Series | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Interest income | 61,769 | 62,984 | ||
Total interest income | 125,301 | 129,284 | ||
Interest expense | 55,224 | 56,992 | ||
Total interest expense | 112,424 | 117,087 | ||
NET INTEREST INCOME | 6,545 | 5,992 | 12,877 | 12,197 |
Unrealized gain on multi-family loans and debt held in securitization trusts, net | 784 | 5,418 | 1,602 | 19,046 |
NET INCOME ATTRIBUTABLE TO COMPANY | $ 7,329 | $ 11,410 | $ 14,479 | $ 31,243 |
Consolidated K-Series - Geograp
Consolidated K-Series - Geographic Concentrations of Credit Risk (Details) - Geographic Concentration Risk - Multi-family loans held in securitization trusts | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
California | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 13.90% | 13.80% |
Texas | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 12.40% | 12.30% |
New York | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 8.10% | 8.00% |
Maryland | ||
Concentration Risk [Line Items] | ||
Geographic concentration, percent | 5.30% | 5.20% |
Use of Special Purpose Entiti65
Use of Special Purpose Entities and Variable Interest Entities - Narrative (Details) $ in Thousands | May 16, 2016 | Jun. 30, 2016USD ($)securitizationproperty | Jun. 30, 2016USD ($)securitizationproperty | Dec. 31, 2015USD ($)securitization | ||||
Variable Interest Entity [Line Items] | ||||||||
Securitized debt | $ 244,016 | $ 244,016 | $ 116,541 | |||||
Unconsolidated VIE, maximum loss exposure | 151,400 | $ 151,400 | 170,700 | |||||
Minimum | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Repurchase agreements, expiration period | 12 months | |||||||
Maximum | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Repurchase agreements, expiration period | 15 months | |||||||
Collateralized Recourse Financing | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Securitized debt | [1],[2] | $ 55,751 | [3] | $ 55,751 | [3] | 55,629 | [4] | |
Repurchase agreements, expiration period | 3 years | |||||||
Distressed Residential Mortgage Loan Securitization | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Securitized debt | [1],[5] | $ 160,304 | [6] | $ 160,304 | [6] | $ 33,299 | [7] | |
Distressed Residential Mortgage Loan Securitization | Minimum | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Number of real estate properties | property | 1 | 1 | ||||||
Distressed Residential Mortgage Loan Securitization | Maximum | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Number of real estate properties | property | 4 | 4 | ||||||
Residential mortgage loans held in securitization trusts | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Number of securitizations completed to date | securitization | 4 | 4 | ||||||
Number of securitizations, consolidated, accounted for as permanent financing | securitization | 3 | 3 | ||||||
K-Series | Consolidated K-Series | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Number of securitizations | securitization | 5 | 5 | 5 | |||||
K-Series | Collateralized Recourse Financing | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Number of securitizations | securitization | 3 | 3 | 3 | |||||
K-Series | Non-Financings, Multi-Family CMBS | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Number of securitizations, non-financing VIE's | securitization | 1 | 1 | 1 | |||||
Distressed residential mortgage loans held in securitization trust, (net) | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net), carrying value | [6] | $ 225,370 | $ 225,370 | |||||
Distressed residential mortgage loans held in securitization trust, (net) | Distressed Residential Mortgage Loan Securitization | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net), carrying value | [7] | $ 114,214 | ||||||
RBDHC | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Subsidiary cumulative percentage ownership after all transactions | 100.00% | |||||||
RBDHC | Variable Interest Entity, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Noncontrolling interest, ownership by parent, percentage | 50.00% | |||||||
[1] | Classified as securitized debt in the liability section of the Company’s accompanying condensed consolidated balance sheets, net of debt issuance costs. | |||||||
[2] | The Company entered into a CMBS Master Repurchase Agreement with a three-year term for the purpose of financing a portion of its multi-family CMBS portfolio. In connection with the transaction, the Company agreed to guarantee the due and punctual payment of its wholly-owned subsidiary's obligations under the CMBS Master Repurchase Agreement. | |||||||
[3] | The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations (see Note 6). One of the Company’s Freddie Mac-sponsored multi-family K-Series securitizations included in the Consolidated K-Series is not subject to any financing as of June 30, 2016. | |||||||
[4] | The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations (see Note 6). | |||||||
[5] | . | |||||||
[6] | The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to a securitization transaction that closed in April 2016 that involved the issuance of $177.5 million of Class A Notes representing the beneficial ownership in a pool of performing and re-performing seasoned mortgage loans having an aggregate principal balance of approximately $282.8 million. The Company holds 5% of the Class A Notes issued as part of the securitization transaction. The Company has repaid the outstanding notes from its distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013 as of June 30, 2016. In connection with the repayment of the notes from the Company's distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013, the Company terminated and deconsolidated the Financing VIE that facilitated these financing transactions and the distressed residential loans serving as collateral on the notes were transferred back to the Company. | |||||||
[7] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOjRiMjUzNWM4NTJjNTQ3Yzc5NWYzZGM3MjYxMDRlYzdjfFRleHRTZWxlY3Rpb246NjdEQTZBNjZDNTc5NUZEN0IwNTE2RUIxNjZCNTZBNjUM} |
Use of Special Purpose Entiti66
Use of Special Purpose Entities and Variable Interest Entities - Assets and Liabilities of Consolidated VIEs (Details) | Jun. 30, 2016USD ($)securitizationproperty | Apr. 01, 2016USD ($) | Dec. 31, 2015USD ($)securitization | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($) | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Cash and cash equivalents, carrying value | $ 49,941,000 | $ 61,959,000 | $ 106,461,000 | $ 75,598,000 | ||||
Investment securities available for sale, at fair value held in securitization trusts | [1] | 42,271,000 | ||||||
Multi-family loans held in securitization trusts, at fair value | 7,282,145,000 | 7,105,336,000 | ||||||
Receivables and other assets | 144,432,000 | 83,995,000 | ||||||
Total Assets | [2] | 9,388,142,000 | 9,056,242,000 | |||||
Securitized debt | 244,016,000 | 116,541,000 | ||||||
Accrued expenses and other liabilities | 61,935,000 | 59,527,000 | ||||||
Total liabilities | [2] | 8,521,099,000 | 8,175,716,000 | |||||
Residential collateralized debt obligations | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 102,597,000 | 116,710,000 | ||||||
Multi-family collateralized debt obligations, at fair value | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 6,981,813,000 | 6,818,901,000 | ||||||
Distressed residential mortgage loans held in securitization trust, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | [3] | 225,370,000 | ||||||
Residential mortgage loans held in securitization trusts, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | 106,173,000 | 119,921,000 | ||||||
Multi-family collateralized mortgage backed securities | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Principal Amount Outstanding on Loans Securitized or Asset-backed Financing Arrangement | [4] | 33,666,000 | 33,781,000 | |||||
Investment securities available for sale, at fair value held in securitization trusts | [5] | 40,734,000 | ||||||
Multi-family loans held in securitization trusts, at fair value | 1,251,124,000 | [1] | 1,224,036,000 | [5] | ||||
Receivables and other assets | 4,316,000 | [1] | 4,864,000 | [5] | ||||
Total Assets | 1,297,711,000 | [1] | 1,269,634,000 | [5] | ||||
Securitized debt | [4],[6] | 27,961,000 | [1] | 27,613,000 | [5] | |||
Accrued expenses and other liabilities | 4,296,000 | [1] | 4,436,000 | [5] | ||||
Total liabilities | 1,225,740,000 | 1,200,519,000 | [5] | |||||
Multi-family collateralized mortgage backed securities | Multi-family collateralized debt obligations, at fair value | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 1,193,483,000 | [1] | 1,168,470,000 | [5] | ||||
Collateralized Recourse Financing | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Principal Amount Outstanding on Loans Securitized or Asset-backed Financing Arrangement | [7] | 55,853,000 | 55,853,000 | |||||
Multi-family loans held in securitization trusts, at fair value | 4,784,427,000 | [8] | 4,633,061,000 | [9] | ||||
Receivables and other assets | 14,467,000 | [8] | 15,281,000 | [9] | ||||
Total Assets | 4,798,894,000 | [8] | 4,648,342,000 | [9] | ||||
Securitized debt | [6],[7] | 55,751,000 | [8] | 55,629,000 | [9] | |||
Accrued expenses and other liabilities | 14,148,000 | [8] | 14,750,000 | [9] | ||||
Total liabilities | 4,676,915,000 | 4,534,719,000 | [9] | |||||
Collateralized Recourse Financing | Multi-family collateralized debt obligations, at fair value | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 4,607,016,000 | [8] | 4,464,340,000 | [9] | ||||
Distressed Residential Mortgage Loan Securitization | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Principal Amount Outstanding on Loans Securitized or Asset-backed Financing Arrangement | [10] | 162,411,000 | 33,656,000 | |||||
Receivables and other assets | 8,696,000 | [3] | 6,076,000 | [11] | ||||
Total Assets | 234,066,000 | [3] | 120,290,000 | [11] | ||||
Securitized debt | [6],[10] | 160,304,000 | [3] | 33,299,000 | [11] | |||
Accrued expenses and other liabilities | 287,000 | [3] | 368,000 | [11] | ||||
Total liabilities | 160,591,000 | 33,667,000 | [11] | |||||
Distressed Residential Mortgage Loan Securitization | Distressed residential mortgage loans held in securitization trust, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | [11] | 114,214,000 | ||||||
Residential Mortgage Loan Securitization | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Receivables and other assets | 810,000 | |||||||
Total Assets | 106,983,000 | 121,121,000 | ||||||
Accrued expenses and other liabilities | 17,000 | 13,000 | ||||||
Total liabilities | 102,614,000 | 116,723,000 | ||||||
Residential Mortgage Loan Securitization | Residential collateralized debt obligations | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 116,710,000 | |||||||
Residential Mortgage Loan Securitization | Residential mortgage loans held in securitization trusts, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | 119,921,000 | |||||||
Receivables and other assets | 1,200,000 | |||||||
Non-Financings, Multi-Family CMBS | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Multi-family loans held in securitization trusts, at fair value | 1,246,594,000 | 1,248,239,000 | [12] | |||||
Receivables and other assets | 5,238,000 | 5,456,000 | [12] | |||||
Total Assets | 1,251,832,000 | 1,253,695,000 | [12] | |||||
Accrued expenses and other liabilities | 5,238,000 | 5,456,000 | [12] | |||||
Total liabilities | 1,186,552,000 | 1,191,547,000 | [12] | |||||
Non-Financings, Multi-Family CMBS | Multi-family collateralized debt obligations, at fair value | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 1,181,314,000 | 1,186,091,000 | [12] | |||||
Financing and Non-Financing VIEs | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Investment securities available for sale, at fair value held in securitization trusts | 42,271,000 | 40,734,000 | ||||||
Multi-family loans held in securitization trusts, at fair value | 7,282,145,000 | 7,105,336,000 | ||||||
Receivables and other assets | 49,587,000 | 32,877,000 | ||||||
Total Assets | 7,706,398,000 | 7,413,082,000 | ||||||
Securitized debt | 244,016,000 | 116,541,000 | ||||||
Accrued expenses and other liabilities | 24,060,000 | 25,023,000 | ||||||
Total liabilities | 7,352,486,000 | 7,077,175,000 | ||||||
Financing and Non-Financing VIEs | Residential collateralized debt obligations | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 102,597,000 | 116,710,000 | ||||||
Financing and Non-Financing VIEs | Multi-family collateralized debt obligations, at fair value | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Collateralized debt obligations | 6,981,813,000 | 6,818,901,000 | ||||||
Financing and Non-Financing VIEs | Distressed residential mortgage loans held in securitization trust, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | 225,370,000 | |||||||
Financing and Non-Financing VIEs | Distressed residential mortgage loans held in securitization trust, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | 114,214,000 | |||||||
Financing and Non-Financing VIEs | Residential mortgage loans held in securitization trusts, (net) | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Residential mortgage loans held in securitization trusts (net) | 106,173,000 | $ 119,921,000 | ||||||
Other VIEs | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Cash and cash equivalents, carrying value | [1] | 852,000 | ||||||
Receivables and other assets | 16,060,000 | |||||||
Total Assets | 16,912,000 | |||||||
Accrued expenses and other liabilities | 74,000 | |||||||
Total liabilities | $ 74,000 | |||||||
K-Series | Multi-family collateralized mortgage backed securities | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Number of securitizations | securitization | 2 | 2 | ||||||
Number of consolidated securitizations | securitization | 1 | 1 | ||||||
K-Series | Collateralized Recourse Financing | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Number of securitizations | securitization | 3 | 3 | ||||||
Minimum | Distressed Residential Mortgage Loan Securitization | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Number of real estate properties | property | 1 | |||||||
Maximum | Distressed Residential Mortgage Loan Securitization | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Number of real estate properties | property | 4 | |||||||
Collateralized Mortgage Obligations [Member] | Class A Notes | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Transfers of Financial Assets Accounted for as Sale, Initial Fair Value of Assets Obtained as Proceeds | $ 0 | |||||||
Principal Amount Outstanding on Loans Securitized or Asset-backed Financing Arrangement | $ 282.8 | |||||||
[1] | The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization (see Note 6). | |||||||
[2] | Our condensed consolidated balance sheets include assets and liabilities of consolidated variable interest entities ("VIEs") as the Company is the primary beneficiary of these VIEs. As of June 30, 2016 and December 31, 2015, assets of consolidated VIEs totaled $7,706,398 and $7,413,082, respectively, and the liabilities of consolidated VIEs totaled $7,352,486 and $7,077,175, respectively. See Note 7 for further discussion. | |||||||
[3] | The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to a securitization transaction that closed in April 2016 that involved the issuance of $177.5 million of Class A Notes representing the beneficial ownership in a pool of performing and re-performing seasoned mortgage loans having an aggregate principal balance of approximately $282.8 million. The Company holds 5% of the Class A Notes issued as part of the securitization transaction. The Company has repaid the outstanding notes from its distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013 as of June 30, 2016. In connection with the repayment of the notes from the Company's distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013, the Company terminated and deconsolidated the Financing VIE that facilitated these financing transactions and the distressed residential loans serving as collateral on the notes were transferred back to the Company. | |||||||
[4] | The Company engaged in the re-securitization transaction primarily for the purpose of obtaining non-recourse financing on a portion of its multi-family CMBS portfolio. As a result of engaging in this transaction, the Company remains economically exposed to the first loss position on the underlying multi-family CMBS transferred to the Consolidated VIE. The holders of the note issued in this re-securitization transaction have no recourse to the general credit of the Company, but the Company does have the obligation, under certain circumstances, to repurchase assets upon the breach of certain representations and warranties. The Company will receive all remaining cash flow, if any, through its retained ownership. | |||||||
[5] | The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization (see Note 6). | |||||||
[6] | Classified as securitized debt in the liability section of the Company’s accompanying condensed consolidated balance sheets, net of debt issuance costs. | |||||||
[7] | The Company entered into a CMBS Master Repurchase Agreement with a three-year term for the purpose of financing a portion of its multi-family CMBS portfolio. In connection with the transaction, the Company agreed to guarantee the due and punctual payment of its wholly-owned subsidiary's obligations under the CMBS Master Repurchase Agreement. | |||||||
[8] | The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations (see Note 6). One of the Company’s Freddie Mac-sponsored multi-family K-Series securitizations included in the Consolidated K-Series is not subject to any financing as of June 30, 2016. | |||||||
[9] | The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations (see Note 6). | |||||||
[10] | . | |||||||
[11] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOjRiMjUzNWM4NTJjNTQ3Yzc5NWYzZGM3MjYxMDRlYzdjfFRleHRTZWxlY3Rpb246NjdEQTZBNjZDNTc5NUZEN0IwNTE2RUIxNjZCNTZBNjUM} | |||||||
[12] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOjRiMjUzNWM4NTJjNTQ3Yzc5NWYzZGM3MjYxMDRlYzdjfFRleHRTZWxlY3Rpb246OUNDNUExRDY2QUNGNUYwODkzOUY4NkMzQzBENkFGMDAM} |
Use of Special Purpose Entiti67
Use of Special Purpose Entities and Variable Interest Entities - Securitized Debt (Details) | 1 Months Ended | 6 Months Ended | |||||
Apr. 30, 2016 | Jun. 30, 2016USD ($)property | Apr. 01, 2016USD ($) | Dec. 31, 2015USD ($) | ||||
Variable Interest Entity [Line Items] | |||||||
Carrying Value at | $ 244,016,000 | $ 116,541,000 | |||||
Multi-family collateralized mortgage backed securities | |||||||
Variable Interest Entity [Line Items] | |||||||
Principal Amount | [1] | 33,666,000 | 33,781,000 | ||||
Carrying Value at | [1],[2] | $ 27,961,000 | [3] | 27,613,000 | [4] | ||
Multi-family collateralized mortgage backed securities | LIBOR | |||||||
Variable Interest Entity [Line Items] | |||||||
Stated interest rate | [1] | 5.35% | |||||
Collateralized Recourse Financing | |||||||
Variable Interest Entity [Line Items] | |||||||
Principal Amount | [5] | $ 55,853,000 | 55,853,000 | ||||
Carrying Value at | [2],[5] | $ 55,751,000 | [6] | 55,629,000 | [7] | ||
Collateralized Recourse Financing | LIBOR | |||||||
Variable Interest Entity [Line Items] | |||||||
Interest rate, basis spread | [5] | 5.25% | |||||
Distressed Residential Mortgage Loan Securitization | |||||||
Variable Interest Entity [Line Items] | |||||||
Principal Amount | [8] | $ 162,411,000 | 33,656,000 | ||||
Carrying Value at | [2],[8] | $ 160,304,000 | [9] | $ 33,299,000 | [10] | ||
Minimum | Distressed Residential Mortgage Loan Securitization | |||||||
Variable Interest Entity [Line Items] | |||||||
Number of real estate properties | property | 1 | ||||||
Minimum | Distressed Residential Mortgage Loan Securitization | LIBOR | |||||||
Variable Interest Entity [Line Items] | |||||||
Stated interest rate | [8] | 4.25% | |||||
Maximum | Distressed Residential Mortgage Loan Securitization | |||||||
Variable Interest Entity [Line Items] | |||||||
Number of real estate properties | property | 4 | ||||||
Maximum | Distressed Residential Mortgage Loan Securitization | LIBOR | |||||||
Variable Interest Entity [Line Items] | |||||||
Stated interest rate | [8] | 4.85% | |||||
Class A Notes | Collateralized Mortgage Obligations [Member] | |||||||
Variable Interest Entity [Line Items] | |||||||
Proceeds from Issuance of Secured Debt | $ 0 | ||||||
Principal Amount | $ 282.8 | ||||||
Available-for-sale Securities, Debt Securities, Ownership Percentage | 5.00% | ||||||
[1] | The Company engaged in the re-securitization transaction primarily for the purpose of obtaining non-recourse financing on a portion of its multi-family CMBS portfolio. As a result of engaging in this transaction, the Company remains economically exposed to the first loss position on the underlying multi-family CMBS transferred to the Consolidated VIE. The holders of the note issued in this re-securitization transaction have no recourse to the general credit of the Company, but the Company does have the obligation, under certain circumstances, to repurchase assets upon the breach of certain representations and warranties. The Company will receive all remaining cash flow, if any, through its retained ownership. | ||||||
[2] | Classified as securitized debt in the liability section of the Company’s accompanying condensed consolidated balance sheets, net of debt issuance costs. | ||||||
[3] | The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization (see Note 6). | ||||||
[4] | The Company classified the multi-family CMBS issued by two K-Series securitizations and held by this Financing VIE as available for sale securities as the purpose is not to trade these securities. The Financing VIE consolidated one K-Series securitization that issued certain of the multi-family CMBS owned by the Company, including its assets, liabilities, income and expenses, in its financial statements, as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in this particular K-Series securitization (see Note 6). | ||||||
[5] | The Company entered into a CMBS Master Repurchase Agreement with a three-year term for the purpose of financing a portion of its multi-family CMBS portfolio. In connection with the transaction, the Company agreed to guarantee the due and punctual payment of its wholly-owned subsidiary's obligations under the CMBS Master Repurchase Agreement. | ||||||
[6] | The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations (see Note 6). One of the Company’s Freddie Mac-sponsored multi-family K-Series securitizations included in the Consolidated K-Series is not subject to any financing as of June 30, 2016. | ||||||
[7] | The multi-family CMBS serving as collateral under the November 2013 collateralized recourse financing are comprised of securities issued from three separate Freddie Mac-sponsored multi-family K-Series securitizations. The Financing VIE consolidated these K-Series securitizations, including their assets, liabilities, income and expenses, in its financial statements as based on a number of factors, the Company determined that it was the primary beneficiary and has a controlling financial interest in such K-Series securitizations (see Note 6). | ||||||
[8] | . | ||||||
[9] | The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to a securitization transaction that closed in April 2016 that involved the issuance of $177.5 million of Class A Notes representing the beneficial ownership in a pool of performing and re-performing seasoned mortgage loans having an aggregate principal balance of approximately $282.8 million. The Company holds 5% of the Class A Notes issued as part of the securitization transaction. The Company has repaid the outstanding notes from its distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013 as of June 30, 2016. In connection with the repayment of the notes from the Company's distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013, the Company terminated and deconsolidated the Financing VIE that facilitated these financing transactions and the distressed residential loans serving as collateral on the notes were transferred back to the Company. | ||||||
[10] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOjRiMjUzNWM4NTJjNTQ3Yzc5NWYzZGM3MjYxMDRlYzdjfFRleHRTZWxlY3Rpb246NjdEQTZBNjZDNTc5NUZEN0IwNTE2RUIxNjZCNTZBNjUM} |
Use of Special Purpose Entiti68
Use of Special Purpose Entities and Variable Interest Entities - Financing VIEs Securitized Debt by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Variable Interest Entity [Line Items] | ||
Carrying value | $ 244,016 | $ 116,541 |
Financing VIE | ||
Variable Interest Entity [Line Items] | ||
Within 24 months | 55,853 | 89,509 |
Long-term Debt, Maturities, Repayments of Principal in Year Three | 162,411 | 0 |
Over 36 months | 33,666 | 33,781 |
Total outstanding principal | 251,930 | 123,290 |
Discount | (6,154) | (5,763) |
Debt Issuance Cost | (1,760) | (986) |
Carrying value | $ 244,016 | $ 116,541 |
Use of Special Purpose Entiti69
Use of Special Purpose Entities and Variable Interest Entities - Classification and Carrying Value of Unconsolidated VIEs (Details) $ in Thousands | Jun. 30, 2016USD ($)securitization | Dec. 31, 2015USD ($)securitization |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | $ 151,385 | $ 170,697 |
K-Series | Multi-family collateralized mortgage backed securities | ||
Variable Interest Entity [Line Items] | ||
Number of securitizations | securitization | 2 | 2 |
Investment Securities Available for Sale At Fair Value | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | $ 42,271 | $ 40,734 |
Receivables and Other Assets | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 75 | 76 |
Mezzanine Loan and Preferred Equity Investments | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 75,300 | 44,151 |
Investment in Unconsolidated Entities | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 33,739 | 85,736 |
Mulit Family CMBS | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 42,346 | 40,810 |
Mulit Family CMBS | Investment Securities Available for Sale At Fair Value | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 42,271 | 40,734 |
Mulit Family CMBS | Receivables and Other Assets | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 75 | 76 |
Mezzanine/Construction Loan on Multi-family Properties | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 19,180 | 17,381 |
Mezzanine/Construction Loan on Multi-family Properties | Mezzanine Loan and Preferred Equity Investments | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 19,180 | 8,663 |
Mezzanine/Construction Loan on Multi-family Properties | Investment in Unconsolidated Entities | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 8,718 | |
Preferred Equity Investment on Multi-family Properties | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 66,904 | 46,264 |
Preferred Equity Investment on Multi-family Properties | Investment Securities Available for Sale At Fair Value | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 0 | 0 |
Preferred Equity Investment on Multi-family Properties | Receivables and Other Assets | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 0 | 0 |
Preferred Equity Investment on Multi-family Properties | Mezzanine Loan and Preferred Equity Investments | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 56,120 | 35,488 |
Preferred Equity Investment on Multi-family Properties | Investment in Unconsolidated Entities | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 10,784 | 10,776 |
Equity Investment in Entities that Invest in Multi-family Properties | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 22,955 | 66,242 |
Equity Investment in Entities that Invest in Multi-family Properties | Receivables and Other Assets | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | 0 | 0 |
Equity Investment in Entities that Invest in Multi-family Properties | Investment in Unconsolidated Entities | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
VIE assets | $ 22,955 | $ 66,242 |
Derivative Instruments and He70
Derivative Instruments and Hedging Activities - Narrative (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2016USD ($)contract | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liabilities | $ 6,438 | $ 1,500 | |
TBA purchases | 81 | $ 6 | |
Restricted cash | $ 55,700 | 20,800 | |
Not Designated as Hedging Instrument | Eurodollar futures | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Number of contracts | contract | 4,224 | ||
Not Designated as Hedging Instrument | TBA | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative liabilities | $ 286,500 | 228,000 | |
Proceeds from sale of investment | 193,300 | 55,100 | |
TBA purchases | 479,800 | 283,100 | |
Not Designated as Hedging Instrument | Interest rate swaps | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Restricted cash | 10,600 | $ 6,300 | |
Derivative assets | $ 200 | ||
Designated as Hedging Instrument | Interest rate swaps | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Time to transfer gain (loss) from AOCI to earnings | 12 months | ||
Estimated transfer of gain (loss) from AOCI to earnings | $ 800 |
Derivative Instruments and He71
Derivative Instruments and Hedging Activities - Fair Value of Derivative Instruments Not Designated as Hedging Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
TBA securities | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Assets | $ 290,318 | $ 226,929 | |
Options on U.S. Treasury futures | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Assets | 27 | 15 | |
Interest rate swap futures | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Assets | 0 | 706 | |
Derivatives Not Designated As Hedging Instruments - Liabilities | 759 | 0 | |
Swaptions | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Assets | 333 | 821 | |
Eurodollar futures | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Liabilities | 4,572 | 1,242 | |
U.S. Treasury futures | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Assets | 1,002 | 0 | |
Interest rate swaps | |||
Derivative [Line Items] | |||
Derivatives Not Designated As Hedging Instruments - Liabilities | [1] | 284 | $ 258 |
Not Designated as Hedging Instrument | Interest rate swaps | |||
Derivative [Line Items] | |||
Derivative liabilities | [1] | 500 | |
Derivative assets | $ 200 | ||
[1] | Includes interest rate swaps in our Agency IO portfolio. Contracts in a liability position of $0.5 million have been netted against the asset position of $0.2 million in the accompanying condensed consolidated balance sheets at June 30, 2016. There was no netting of interest rate swaps at December 31, 2015. |
Derivative Instruments and He72
Derivative Instruments and Hedging Activities - Derivative Instruments Not Designated as Hedges (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Settlement, Expiration or Exercise | $ 0 | |
Not Designated as Hedging Instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Settlement, Expiration or Exercise | $ 0 | |
Not Designated as Hedging Instrument | TBA securities | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | 222,000 | 273,000 |
Additions | 1,952,000 | 2,176,000 |
Settlement, Expiration or Exercise | (1,893,000) | (2,153,000) |
Ending balance | 281,000 | 296,000 |
Not Designated as Hedging Instrument | U.S. Treasury futures | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | 0 | 2,300 |
Additions | 117,700 | 123,600 |
Settlement, Expiration or Exercise | (78,000) | (135,400) |
Ending balance | 39,700 | (9,500) |
Not Designated as Hedging Instrument | Interest rate swap futures | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | (137,200) | (190,100) |
Additions | 546,600 | 597,800 |
Settlement, Expiration or Exercise | (477,300) | (605,000) |
Ending balance | (67,900) | (197,300) |
Not Designated as Hedging Instrument | Eurodollar futures | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | (2,769,000) | (2,961,000) |
Additions | 1,640,000 | 1,463,000 |
Settlement, Expiration or Exercise | (3,095,000) | (1,453,000) |
Ending balance | (4,224,000) | (2,951,000) |
Not Designated as Hedging Instrument | Options on U.S. Treasury futures | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | 28,000 | 21,000 |
Additions | 66,000 | 187,000 |
Settlement, Expiration or Exercise | (64,000) | (201,000) |
Ending balance | 30,000 | 7,000 |
Not Designated as Hedging Instrument | Swaptions | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | 159,000 | 180,000 |
Additions | 0 | 9,000 |
Settlement, Expiration or Exercise | (5,000) | 0 |
Ending balance | 154,000 | 189,000 |
Not Designated as Hedging Instrument | Interest rate swaps | ||
Derivative Instruments and Hedging Activities Disclosures [Roll Forward] | ||
Beginning balance | 10,000 | 10,000 |
Additions | 5,000 | 0 |
Ending balance | $ 15,000 | $ 10,000 |
Derivative Instruments and He73
Derivative Instruments and Hedging Activities - Components of Realized and Unrealized Gains and Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Unrealized Gains (Losses) | $ (667) | $ 4,716 | $ (3,159) | $ (1,012) |
Not Designated as Hedging Instrument | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Realized Gains (Losses) | 2,252 | (4,442) | 4,007 | (3,303) |
Unrealized Gains (Losses) | 1,326 | (608) | (365) | (5,260) |
TBA securities | Not Designated as Hedging Instrument | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Realized Gains (Losses) | 3,700 | (2,243) | 8,508 | 587 |
Unrealized Gains (Losses) | 1,454 | (2,749) | 3,430 | (2,095) |
Eurodollar futures | Not Designated as Hedging Instrument | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Realized Gains (Losses) | (724) | (1,032) | (1,506) | (1,279) |
Unrealized Gains (Losses) | (1,294) | 185 | (3,330) | (1,388) |
Interest rate swaps | Not Designated as Hedging Instrument | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Realized Gains (Losses) | 0 | 0 | 0 | 0 |
Unrealized Gains (Losses) | 93 | 90 | (26) | (29) |
Swaptions | Not Designated as Hedging Instrument | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Realized Gains (Losses) | 0 | 0 | 0 | 0 |
Unrealized Gains (Losses) | 150 | 516 | 22 | (41) |
Options on U.S. Treasury futures | Not Designated as Hedging Instrument | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Realized Gains (Losses) | (724) | (1,167) | (2,995) | (2,611) |
Unrealized Gains (Losses) | $ 923 | $ 1,350 | $ (461) | $ (1,707) |
Derivative Instruments and He74
Derivative Instruments and Hedging Activities - Fair Value of Derivative Instruments Designated as Hedging Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Derivatives, Fair Value [Line Items] | |||||
Unrealized (loss) gain on investment securities and related hedges, net | $ (667) | $ 4,716 | $ (3,159) | $ (1,012) | |
Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Realized Gains (Losses) | 2,252 | (4,442) | 4,007 | (3,303) | |
Unrealized (loss) gain on investment securities and related hedges, net | 1,326 | (608) | (365) | (5,260) | |
Not Designated as Hedging Instrument | TBA securities | |||||
Derivatives, Fair Value [Line Items] | |||||
Realized Gains (Losses) | 3,700 | (2,243) | 8,508 | 587 | |
Unrealized (loss) gain on investment securities and related hedges, net | 1,454 | (2,749) | 3,430 | (2,095) | |
Not Designated as Hedging Instrument | Interest rate swaps | |||||
Derivatives, Fair Value [Line Items] | |||||
Realized Gains (Losses) | 0 | 0 | 0 | 0 | |
Unrealized (loss) gain on investment securities and related hedges, net | 93 | 90 | (26) | (29) | |
Not Designated as Hedging Instrument | Eurodollar futures | |||||
Derivatives, Fair Value [Line Items] | |||||
Realized Gains (Losses) | (724) | (1,032) | (1,506) | (1,279) | |
Unrealized (loss) gain on investment securities and related hedges, net | (1,294) | 185 | (3,330) | (1,388) | |
Not Designated as Hedging Instrument | Swaptions | |||||
Derivatives, Fair Value [Line Items] | |||||
Realized Gains (Losses) | 0 | 0 | 0 | 0 | |
Unrealized (loss) gain on investment securities and related hedges, net | 150 | 516 | 22 | (41) | |
Not Designated as Hedging Instrument | Options on U.S. Treasury futures | |||||
Derivatives, Fair Value [Line Items] | |||||
Realized Gains (Losses) | (724) | (1,167) | (2,995) | (2,611) | |
Unrealized (loss) gain on investment securities and related hedges, net | 923 | $ 1,350 | (461) | $ (1,707) | |
Designated as Hedging Instrument | Interest rate swaps | |||||
Derivatives, Fair Value [Line Items] | |||||
Derivative liability, notional amount | 215,000 | 215,000 | |||
Derivative liability, fair value | 823 | 823 | $ 0 | ||
Derivative asset, notional amount | 350,000 | 350,000 | |||
Derivative asset, fair value | $ 0 | $ 0 | $ 304 |
Derivative Instruments and He75
Derivative Instruments and Hedging Activities - Derivative Instruments Included in the Company's Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of the period | $ 880,526 | |
Balance at end of the period | 863,967 | |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of the period | 304 | $ 1,135 |
Unrealized loss on interest rate swaps | (1,127) | (1,163) |
Balance at end of the period | $ (823) | $ (28) |
Derivative Instruments and He76
Derivative Instruments and Hedging Activities - Interest Rate Swaps and Interest Rate Caps (Details) - Designated as Hedging Instrument - Interest rate swaps - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Interest expense-investment securities | $ 209 | $ 439 | $ 427 | |
Cash Flow Hedging | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Interest expense-investment securities | $ 890 |
Derivative Instruments and He77
Derivative Instruments and Hedging Activities - Interest Rate Swaps (Details) - Cash Flow Hedging - Designated as Hedging Instrument - Interest rate swaps - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional Amount | $ 225,000 | $ 225,000 |
Weighted Average Fixed Interest Rate | 0.90% | 0.90% |
Weighted Average Variable Interest Rate | 0.46% | 0.40% |
2,017 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional Amount | $ 215,000 | $ 215,000 |
Weighted Average Fixed Interest Rate | 0.83% | 0.83% |
Weighted Average Variable Interest Rate | 0.45% | 0.39% |
2,019 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional Amount | $ 10,000 | $ 10,000 |
Weighted Average Fixed Interest Rate | 2.25% | 2.25% |
Weighted Average Variable Interest Rate | 0.64% | 0.59% |
Agency IOs | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional Amount | $ 5,000 | $ 0 |
Weighted Average Fixed Interest Rate | 1.80% | 0.00% |
Weighted Average Variable Interest Rate | 0.62% | 0.00% |
Agency IOs | 2026 | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional Amount | $ 5,000 | $ 0 |
Weighted Average Fixed Interest Rate | 1.80% | 0.00% |
Weighted Average Variable Interest Rate | 0.62% | 0.00% |
Financing Arrangements, Portf78
Financing Arrangements, Portfolio Investments - Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016USD ($)counterparty | Jun. 30, 2016USD ($)counterparty | Dec. 31, 2015USD ($)counterparty | Jun. 30, 2015USD ($) | Dec. 31, 2014USD ($) | |
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Repurchase agreement, amount outstanding | $ 618,100 | $ 618,100 | $ 577,400 | ||
Average days to maturity | 20 days | 27 days | |||
Interest payable | $ 200 | $ 200 | $ 300 | ||
Advance rate | 89.90% | 89.90% | |||
Average haircut | 10.10% | 10.10% | |||
Repurchase agreements, number of counterparties | counterparty | 6 | 6 | 6 | ||
Cash and cash equivalents | $ 49,941 | $ 49,941 | $ 61,959 | $ 106,461 | $ 75,598 |
Unencumbered investment securities | $ 161,000 | $ 161,000 | |||
Liquidation proceeds, percentage | 40.50% | ||||
Lender Concentration Risk | Stockholders' Equity, Total | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Repurchase agreements, number of counterparties | counterparty | 0 | 0 | 0 | ||
Agency RMBS | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Average haircut | 5.00% | 5.00% | 5.00% | ||
Non-Agency RMBS | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Average haircut | 20.00% | 20.00% | |||
Unencumbered investment securities | $ 7,600 | $ 7,600 | |||
CMBS | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Average haircut | 25.00% | 25.00% | |||
Unencumbered investment securities | $ 112,400 | $ 112,400 | |||
Agency IOs | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Average haircut | 25.00% | 25.00% | |||
Residential Mortgage Backed Securities | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Unencumbered investment securities | $ 41,000 | $ 41,000 | |||
Held in Agency IO Portfolio for Trading Purposes | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Unencumbered investment securities | $ 39,700 | $ 39,700 | |||
GLIH | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Advances from FHLB | $ 121,000 | ||||
Loans | |||||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||||
Weighted average interest rate | 0.97% | 0.97% | 0.71% |
Financing Arrangements, Portf79
Financing Arrangements, Portfolio Investments - Assets Pledged as Collateral (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||
Outstanding Financing Arrangements | $ 618,050 | $ 577,413 | [1] |
Fair Value of Collateral Pledged | 700,817 | 639,683 | |
Amortized Cost of Collateral Pledged | 717,214 | 669,825 | |
Agency ARMs | |||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||
Outstanding Financing Arrangements | 119,830 | 227,609 | [1] |
Fair Value of Collateral Pledged | 126,497 | 141,585 | |
Amortized Cost of Collateral Pledged | 126,469 | 143,754 | |
Agency Fixed Rate | |||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||
Outstanding Financing Arrangements | 329,740 | 261,644 | [1] |
Fair Value of Collateral Pledged | 347,449 | 374,691 | |
Amortized Cost of Collateral Pledged | 351,450 | 386,853 | |
Agency IOs/U.S. Treasury Securities | |||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||
Outstanding Financing Arrangements | 76,028 | 88,160 | [1] |
Fair Value of Collateral Pledged | 104,335 | 123,407 | |
Amortized Cost of Collateral Pledged | 117,310 | 139,218 | |
Non Agency/CMBS | |||
Financial Instruments Owned and Pledged as Collateral [Line Items] | |||
Outstanding Financing Arrangements | 92,452 | 0 | [1] |
Fair Value of Collateral Pledged | 122,536 | 0 | |
Amortized Cost of Collateral Pledged | $ 121,985 | $ 0 | |
[1] | Includes FHLBI advances amounting to $121.0 million as of December 31, 2015. |
Financing Arrangements, Portf80
Financing Arrangements, Portfolio Investments - Outstanding Repurchase Agreement Borrowings by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Assets Sold under Agreements to Repurchase [Line Items] | |||
Outstanding repurchase agreement by contractual maturity | $ 618,050 | $ 577,413 | [1] |
Within 30 days | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Outstanding repurchase agreement by contractual maturity | 566,447 | 468,402 | |
Over 30 days to 90 days | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Outstanding repurchase agreement by contractual maturity | 51,603 | 85,423 | |
Over 90 days | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Outstanding repurchase agreement by contractual maturity | $ 0 | $ 23,588 | |
[1] | Includes FHLBI advances amounting to $121.0 million as of December 31, 2015. |
Financing Arrangements, Resid81
Financing Arrangements, Residential Mortgage Loans - Narrative (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2016 | Dec. 31, 2015 | Nov. 25, 2015 | |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||
Repurchase agreement, amount outstanding | $ 618,100,000 | $ 577,400,000 | |
Pool of Distressed Residential Mortgage Loans | Deutsche Bank AG, Cayman Islands Branch | |||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||
Maximum repurchase amount | 250,000,000 | ||
Repurchase agreement, amount outstanding | $ 176,200,000 | $ 214,500,000 | |
Repurchase agreement, effective interest rate | 2.95% | 2.92% | |
Pool of Distressed Residential Mortgage Loans | Deutsche Bank AG, Cayman Islands Branch | LIBOR | |||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||
Interest rate, basis spread | 2.50% | ||
Residential Mortgage | Deutsche Bank AG, Cayman Islands Branch | |||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||
Maximum repurchase amount | $ 100,000,000 | ||
Repurchase agreement, amount outstanding | $ 0 | $ 0 | |
Residential Mortgage | Deutsche Bank AG, Cayman Islands Branch | LIBOR | |||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||
Interest rate, basis spread | 4.00% |
Residential Collateralized De82
Residential Collateralized Debt Obligations - Narrative (Details) $ in Millions | Jun. 30, 2016USD ($)securitization | Dec. 31, 2015USD ($)securitization |
Debt Instrument [Line Items] | ||
Number of residential CDO securitizations | securitization | 3 | 3 |
Net investment in securitization trusts | $ 4.4 | $ 4.4 |
Arm Loans | ||
Debt Instrument [Line Items] | ||
Loans pledged as collateral | 109.2 | 122.5 |
Residential collateralized debt obligations | ||
Debt Instrument [Line Items] | ||
Secured debt | $ 102.6 | $ 116.7 |
Weighted average interest rate | 0.84% | 0.80% |
Subordinated Debentures - Subor
Subordinated Debentures - Subordinate Borrowings (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
NYM Preferred Trust I | ||
Subordinated Borrowing [Line Items] | ||
Principal value of trust preferred securities | $ 25,000,000 | $ 25,000,000 |
Interest Rate | Three month LIBOR plus 3.75%, resetting quarterly | Three month LIBOR plus 3.75%, resetting quarterly |
Scheduled maturity | March 30, 2035 | March 30, 2035 |
NYM Preferred Trust I | LIBOR | ||
Subordinated Borrowing [Line Items] | ||
Interest rate, basis spread | 3.75% | 3.75% |
NYM Preferred Trust II | ||
Subordinated Borrowing [Line Items] | ||
Principal value of trust preferred securities | $ 20,000,000 | $ 20,000,000 |
Interest Rate | Three month LIBOR plus 3.95%, resetting quarterly | Three month LIBOR plus 3.95%, resetting quarterly |
Scheduled maturity | October 30, 2035 | October 30, 2035 |
NYM Preferred Trust II | LIBOR | ||
Subordinated Borrowing [Line Items] | ||
Interest rate, basis spread | 3.95% | 3.95% |
Fair Value of Financial Instr84
Fair Value of Financial Instruments - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | ||
Feb. 28, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | ||
Distressed residential mortgage loans held in securitization trust, (net) | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Loans, carrying value | $ 225,370 | $ 114,214 | ||
Residential mortgage loans held in securitization trusts (net) | [1] | 225,370 | ||
Distressed Residential Mortgage Loans | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Loans, carrying value | 543,400 | 559,000 | ||
Residential mortgage loans held in securitization trusts (net) | $ 318,000 | 444,800 | ||
PO Security | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Proceeds from sale of investment | $ 44,300 | |||
Gain on sale of investment | 1,500 | |||
Minimum | Collateralized Mortgage Backed Securities Held In Securitization Trusts | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value inputs, discount rate | 4.50% | |||
Maximum | Collateralized Mortgage Backed Securities Held In Securitization Trusts | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value inputs, discount rate | 10.50% | |||
Equity Method Investments | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Equity method investment | $ 63,100 | $ 67,600 | ||
Multi-family collateralized mortgage backed securities | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Transfer of financial assets, amount derecognized | 1,100,000 | |||
Multi-family collateralized debt obligations, at fair value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Transfer of financial assets, amount derecognized | $ 1,000,000 | |||
[1] | The Company engaged in these transactions for the purpose of financing distressed residential mortgage loans acquired by the Company. The distressed residential mortgage loans serving as collateral for the financings are comprised of performing, re-performing and, to a lesser extent, non-performing, fixed and adjustable-rate, fully-amortizing, interest only and balloon, seasoned mortgage loans secured by first liens on one to four family properties. Balances are related to a securitization transaction that closed in April 2016 that involved the issuance of $177.5 million of Class A Notes representing the beneficial ownership in a pool of performing and re-performing seasoned mortgage loans having an aggregate principal balance of approximately $282.8 million. The Company holds 5% of the Class A Notes issued as part of the securitization transaction. The Company has repaid the outstanding notes from its distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013 as of June 30, 2016. In connection with the repayment of the notes from the Company's distressed residential mortgage loan securitizations completed in December 2012, July 2013 and September 2013, the Company terminated and deconsolidated the Financing VIE that facilitated these financing transactions and the distressed residential loans serving as collateral on the notes were transferred back to the Company. |
Fair Value of Financial Instr85
Fair Value of Financial Instruments - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Assets carried at fair value | |||
Investment securities available for sale | [1] | $ 796,489 | $ 765,454 |
Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment in unconsolidated entities | 63,055 | 67,571 | |
Total | 8,433,369 | 8,167,136 | |
Liabilities carried at fair value | |||
Total | 6,988,251 | 6,820,401 | |
TBA securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 290,318 | 226,929 | |
Options on U.S. Treasury futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 27 | 15 | |
Interest rate swap futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 706 | |
Liabilities carried at fair value | |||
Derivative liabilities | 759 | 0 | |
U.S. Treasury futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 1,002 | 0 | |
Eurodollar futures | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Derivative liabilities | 4,572 | 1,242 | |
Interest rate swaps | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 304 | |
Liabilities carried at fair value | |||
Derivative liabilities | 1,107 | 258 | |
Swaptions | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 333 | 821 | |
Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 613,304 | 713,116 | |
Non-Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 110,371 | 1,567 | |
U.S. Treasury securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 7,997 | 10,037 | |
Collateralized Mortgage Backed Securities Held In Securitization Trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 64,817 | 40,734 | |
Multi-family loans held in securitization trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Multi-family loans held in securitization trusts | 7,282,145 | 7,105,336 | |
Multi-family collateralized debt obligations | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Multi-family collateralized debt obligations | 6,981,813 | 6,818,901 | |
Level 1 | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment in unconsolidated entities | 0 | 0 | |
Total | 9,026 | 10,758 | |
Liabilities carried at fair value | |||
Total | 5,331 | 1,242 | |
Level 1 | TBA securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Level 1 | Options on U.S. Treasury futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 27 | 15 | |
Level 1 | Interest rate swap futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 706 | |
Liabilities carried at fair value | |||
Derivative liabilities | 759 | 0 | |
Level 1 | U.S. Treasury futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 1,002 | 0 | |
Level 1 | Eurodollar futures | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Derivative liabilities | 4,572 | 1,242 | |
Level 1 | Interest rate swaps | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Liabilities carried at fair value | |||
Derivative liabilities | 0 | ||
Level 1 | Swaptions | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Level 1 | Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 1 | Non-Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 1 | U.S. Treasury securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 7,997 | 10,037 | |
Level 1 | Collateralized Mortgage Backed Securities Held In Securitization Trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 1 | Multi-family loans held in securitization trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Multi-family loans held in securitization trusts | 0 | 0 | |
Level 1 | Multi-family collateralized debt obligations | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Multi-family collateralized debt obligations | 0 | 0 | |
Level 2 | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Investment in unconsolidated entities | 0 | 0 | |
Total | 1,036,872 | 942,737 | |
Liabilities carried at fair value | |||
Total | 1,107 | 258 | |
Level 2 | TBA securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 290,318 | 226,929 | |
Level 2 | Options on U.S. Treasury futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Level 2 | Interest rate swap futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Liabilities carried at fair value | |||
Derivative liabilities | 0 | 0 | |
Level 2 | Eurodollar futures | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Derivative liabilities | 0 | 0 | |
Level 2 | Interest rate swaps | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 304 | |
Liabilities carried at fair value | |||
Derivative liabilities | 1,107 | 258 | |
Level 2 | Swaptions | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 333 | 821 | |
Level 2 | Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 613,304 | 713,116 | |
Level 2 | Non-Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 110,371 | 1,567 | |
Level 2 | U.S. Treasury securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 2 | Collateralized Mortgage Backed Securities Held In Securitization Trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 22,546 | 0 | |
Level 2 | Multi-family loans held in securitization trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Multi-family loans held in securitization trusts | 0 | 0 | |
Level 2 | Multi-family collateralized debt obligations | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Multi-family collateralized debt obligations | 0 | 0 | |
Level 3 | |||
Assets carried at fair value | |||
Investment in unconsolidated entities | [2] | 74,304 | 87,558 |
Level 3 | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Investment in unconsolidated entities | 63,055 | 67,571 | |
Total | 7,387,471 | 7,213,641 | |
Liabilities carried at fair value | |||
Total | 6,981,813 | 6,818,901 | |
Level 3 | TBA securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Level 3 | Options on U.S. Treasury futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Level 3 | Interest rate swap futures | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Liabilities carried at fair value | |||
Derivative liabilities | 0 | 0 | |
Level 3 | Eurodollar futures | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Derivative liabilities | 0 | 0 | |
Level 3 | Interest rate swaps | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Liabilities carried at fair value | |||
Derivative liabilities | 0 | 0 | |
Level 3 | Swaptions | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Derivative assets | 0 | 0 | |
Level 3 | Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 3 | Non-Agency RMBS | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 3 | U.S. Treasury securities | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 0 | 0 | |
Level 3 | Collateralized Mortgage Backed Securities Held In Securitization Trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Investment securities available for sale | 42,271 | 40,734 | |
Level 3 | Multi-family loans held in securitization trusts | Fair Value, Measurements, Recurring | |||
Assets carried at fair value | |||
Multi-family loans held in securitization trusts | 7,282,145 | 7,105,336 | |
Level 3 | Multi-family collateralized debt obligations | Fair Value, Measurements, Recurring | |||
Liabilities carried at fair value | |||
Multi-family collateralized debt obligations | $ 6,981,813 | $ 6,818,901 | |
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. | ||
[2] | Includes investments in unconsolidated entities accounted for under the fair value option with a carrying value of $63.1 million and $67.6 million at June 30, 2016 and December 31, 2015, respectively. |
Fair Value of Financial Instr86
Fair Value of Financial Instruments - Valuation for Level 3 Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance at beginning of period | $ 7,213,641 | $ 8,442,604 | |
Total gains/(losses) (realized/unrealized) | |||
Included in earnings | [1] | 240,755 | (12,863) |
Included in other comprehensive income | 124 | 422 | |
Sales | [2] | 0 | (1,073,029) |
Transfers in | [3] | 52,176 | 0 |
Transfers out | [4] | (56,756) | 0 |
Contributions | 1,500 | 12,701 | |
Paydowns | (58,993) | (38,475) | |
Distributions | (4,976) | (382) | |
Balance at the end of period | $ 7,387,471 | $ 7,330,978 | |
[1] | Amounts included in interest income from multi-family loans held in securitization trusts, unrealized gain on multi-family loans and debt held in securitization trusts, realized gain (loss) on investment securities and related hedges, gain on de-consolidation, and other income. | ||
[2] | In February 2015, the Company sold a first loss PO security from one of the Company’s Consolidated K-Series securitizations obtaining total proceeds of approximately $44.3 million and realizing a gain of approximately $1.5 million. The sale resulted in a de-consolidation of $1.1 billion in multi-family loans held in a securitization trust and $1.0 billion in Multi-Family CDOs. | ||
[3] | (3) Transfers into Level 3 are investments in unconsolidated entities held by RiverBanc and RBMI for which the Company accounts under the equity method of accounting with a fair value election. These transfers in are a result of the Company’s acquisition of the outstanding membership interests in RiverBanc and RBMI that were not previously owned by the Company on May 16, 2016, which resulted in consolidation of these entities into the Company's financial statements. (see Note 19). | ||
[4] | (4) Transfers out of Level 3 are the Company’s previously held membership interests in RBMI and RBDHC that were accounted for under the equity method of accounting with a fair value election. These transfers out are a result of the Company’s acquisition of the outstanding membership interests in RBMI and RBDHC that were not previously owned by the Company on May 16, 2016, which resulted in consolidation of these entities into the Company's financial statements. (see Note 19). |
Fair Value of Financial Instr87
Fair Value of Financial Instruments - Valuation for Level 3 Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance at beginning of period | $ 6,818,901 | $ 8,048,053 | |
Total gains/(losses) (realized/unrealized) | |||
Included in earnings | [1] | 221,899 | (46,999) |
Sales | [2] | 0 | (1,031,268) |
Paydowns | (58,987) | (37,694) | |
Balance at the end of period | $ 6,981,813 | $ 6,932,092 | |
[1] | Amounts included in interest expense on Multi-Family CDOs, realized gain (loss) on investment securities and related hedges and unrealized gain on multi-family loans and debt held in securitization trusts. | ||
[2] | In February 2015, the Company sold a first loss PO security from one of the Company’s Consolidated K-Series securitizations obtaining total proceeds of approximately $44.3 million and realizing a gain of approximately $1.5 million. The sale resulted in a de-consolidation of $1.1 billion in multi-family loans held in a securitization trust and $1.0 billion in Multi-Family CDOs. |
Fair Value of Financial Instr88
Fair Value of Financial Instruments - Changes in Unrealized Gains (Losses) Included in Earnings for Level 3 (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Net change in unrealized gains included in earnings for assets and liabilities | $ 784 | $ 5,418 | $ 1,602 | $ 19,046 | |
Level 3 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Change in unrealized gains (losses)– assets (1) | [1] | 65,763 | (136,701) | 255,656 | (305) |
Change in unrealized (losses) gains – liabilities | (64,979) | 142,119 | (254,054) | 19,351 | |
Net change in unrealized gains included in earnings for assets and liabilities | $ 784 | $ 5,418 | $ 1,602 | $ 19,046 | |
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. |
Fair Value of Financial Instr89
Fair Value of Financial Instruments - Assets Measured at Fair Value on a Nonrecurring Basis (Details) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Residential mortgage loans held in securitization trusts – impaired loans (net) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Residential mortgage loans held in securitization trusts – impaired loans (net) | $ 9,044 | $ 8,976 |
Real estate owned held in residential securitization trusts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate owned held in residential securitization trusts | 72 | 411 |
Level 1 | Residential mortgage loans held in securitization trusts – impaired loans (net) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Residential mortgage loans held in securitization trusts – impaired loans (net) | 0 | 0 |
Level 1 | Real estate owned held in residential securitization trusts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate owned held in residential securitization trusts | 0 | 0 |
Level 2 | Residential mortgage loans held in securitization trusts – impaired loans (net) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Residential mortgage loans held in securitization trusts – impaired loans (net) | 0 | 0 |
Level 2 | Real estate owned held in residential securitization trusts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate owned held in residential securitization trusts | 0 | 0 |
Level 3 | Residential mortgage loans held in securitization trusts – impaired loans (net) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Residential mortgage loans held in securitization trusts – impaired loans (net) | 9,044 | 8,976 |
Level 3 | Real estate owned held in residential securitization trusts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate owned held in residential securitization trusts | $ 72 | $ 411 |
Fair Value of Financial Instr90
Fair Value of Financial Instruments - Losses Incurred for Assets Measured at Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Residential mortgage loans held in securitization trusts – impaired loans (net) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Gain (loss) for assets measured at fair value on a non-recurring basis | $ 163 | $ (345) | $ 432 | $ (656) |
Real estate owned held in residential securitization trusts | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Gain (loss) for assets measured at fair value on a non-recurring basis | $ (225) | $ 0 | $ (23) | $ 26 |
Fair Value of Financial Instr91
Fair Value of Financial Instruments - Carrying Value and Estimated Fair Value of the Company's Financial Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | ||
Financial Assets: | ||||||
Cash and cash equivalents | $ 49,941 | $ 61,959 | $ 106,461 | $ 75,598 | ||
Investment securities available for sale | [1] | 796,489 | 765,454 | |||
Derivative assets, carrying value | 291,680 | 228,775 | ||||
Mezzanine loan and equity investments, carrying value | 144,432 | 83,995 | ||||
Financial Liabilities: | ||||||
Outstanding Financing Arrangements | 618,050 | 577,413 | [2] | |||
Derivative liabilities | 6,438 | 1,500 | ||||
Subordinated debentures, carrying value | 45,000 | 45,000 | ||||
Available-for-sale securities | ||||||
Financial Liabilities: | ||||||
Assets held in securitization trusts | 42,271 | 40,734 | ||||
Portfolio Investments | ||||||
Financial Liabilities: | ||||||
Outstanding Financing Arrangements | 618,050 | 577,413 | ||||
Residential collateralized debt obligations | ||||||
Financial Liabilities: | ||||||
Secured debt | 102,597 | 116,710 | ||||
Multi-family collateralized debt obligations | ||||||
Financial Liabilities: | ||||||
Secured debt | 6,981,813 | 6,818,901 | ||||
Level 1 | ||||||
Financial Assets: | ||||||
Cash and cash equivalents | 49,941 | 61,959 | ||||
Cash and cash equivalents, estimated fair value | 49,941 | 61,959 | ||||
Financial Liabilities: | ||||||
Payable for securities purchased, carrying value | 286,452 | 227,969 | ||||
Payable for securities purchased, estimated fair value | 286,452 | 227,969 | ||||
Level 2 | Portfolio Investments | ||||||
Financial Liabilities: | ||||||
Outstanding Financing Arrangements | 618,050 | 577,413 | ||||
Level 2 | Distressed Residential Mortgage Loans | ||||||
Financial Liabilities: | ||||||
Outstanding Financing Arrangements | 174,798 | 212,155 | ||||
Level 3 | ||||||
Financial Assets: | ||||||
Mortgage loans held for sale (net), carrying value | [3] | 5,283 | 5,471 | |||
Mortgage loans held for sale (net), estimated fair value | [3] | 5,328 | 5,557 | |||
First mortgage loans, carrying value | [3] | 10,391 | 2,706 | |||
First mortgage loans, estimated fair value | [3] | 10,531 | 2,846 | |||
Mezzanine loan and equity investments, carrying value | [4] | 75,300 | 44,151 | |||
Mezzanine loan and equity investments, estimated fair value | [4] | 76,004 | 44,540 | |||
Equity method investment | [5] | 73,839 | 87,662 | |||
Investments in unconsolidated entities, estimated fair value | [5] | 74,304 | 87,558 | |||
Financial Liabilities: | ||||||
Secured debt | 244,016 | 116,541 | ||||
Secured debt, estimated fair value | 252,252 | 123,776 | ||||
Subordinated debentures, carrying value | 45,000 | 45,000 | ||||
Subordinated debentures, estimated fair value | 44,081 | 42,731 | ||||
Level 3 | Residential mortgage loans held in securitization trusts | ||||||
Financial Assets: | ||||||
Residential mortgage loans held in securitization trusts (net), carrying value | 106,173 | 119,921 | ||||
Multi-family loans held in securitization trusts, estimated fair value | 93,314 | 109,120 | ||||
Level 3 | Distressed Residential Mortgage Loans | ||||||
Financial Assets: | ||||||
Residential mortgage loans held in securitization trusts (net), carrying value | [6] | 543,361 | 558,989 | |||
Multi-family loans held in securitization trusts, estimated fair value | [6] | 544,858 | 564,310 | |||
Level 3 | Multi-family loans held in securitization trusts | ||||||
Financial Assets: | ||||||
Residential mortgage loans held in securitization trusts (net), carrying value | 7,282,145 | 7,105,336 | ||||
Multi-family loans held in securitization trusts, estimated fair value | 7,282,145 | 7,105,336 | ||||
Level 3 | Residential collateralized debt obligations | ||||||
Financial Liabilities: | ||||||
Secured debt | 102,597 | 116,710 | ||||
Secured debt, estimated fair value | 92,522 | 105,606 | ||||
Level 3 | Multi-family collateralized debt obligations | ||||||
Financial Liabilities: | ||||||
Secured debt | 6,981,813 | 6,818,901 | ||||
Secured debt, estimated fair value | 6,981,813 | 6,818,901 | ||||
Level 1 and 2 | ||||||
Financial Assets: | ||||||
Derivative assets, carrying value | 291,680 | 228,775 | ||||
Financial Liabilities: | ||||||
Derivative liabilities | 6,438 | 1,500 | ||||
Distressed Residential Mortgage Loans | ||||||
Financial Assets: | ||||||
Residential mortgage loans held in securitization trusts (net), carrying value | $ 318,000 | $ 444,800 | ||||
[1] | Includes $42.3 million and $40.7 million of investment securities for sale held in securitization trusts as of June 30, 2016 and December 31, 2015, respectively. | |||||
[2] | Includes FHLBI advances amounting to $121.0 million as of December 31, 2015. | |||||
[3] | Included in receivables and other assets in the accompanying condensed consolidated balance sheets. | |||||
[4] | Includes mezzanine loan and preferred equity investments accounted for as loans (see Note 2). | |||||
[5] | Includes investments in unconsolidated entities accounted for under the fair value option with a carrying value of $63.1 million and $67.6 million at June 30, 2016 and December 31, 2015, respectively. | |||||
[6] | Includes distressed residential mortgage loans held in securitization trusts with a carrying value amounting to approximately $225.4 million and $114.2 million at June 30, 2016 and December 31, 2015, respectively, and distressed residential mortgage loans with a carrying value amounting to approximately $318.0 million and $444.8 million at June 30, 2016 and December 31, 2015, respectively. |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) | Apr. 22, 2015USD ($)$ / sharesshares | Jun. 04, 2013USD ($)$ / sharesshares | Jun. 30, 2016USD ($)directorquarter$ / sharesshares | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)directorquarter$ / sharesshares | Jun. 30, 2015USD ($)shares | Dec. 31, 2015$ / sharesshares | Mar. 20, 2015USD ($)$ / sharesshares | Mar. 31, 2015$ / shares | Jun. 11, 2012USD ($) |
Class of Stock [Line Items] | ||||||||||
Preferred stock, shares authorized (in shares) | 200,000,000 | 200,000,000 | 200,000,000 | |||||||
Preferred stock, par value (in Dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||||
Preferred stock, shares issued (in shares) | 6,600,000 | 6,600,000 | 6,600,000 | |||||||
Preferred stock, shares outstanding (in shares) | 6,600,000 | 6,600,000 | 6,600,000 | |||||||
Preferred stock issuance, net | $ | $ 0 | $ 86,862,000 | ||||||||
Proceeds from initial public offering | $ | $ 0 | $ 0 | ||||||||
Common stock, par value (in Dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||||
Equity Distribution Agreements | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued | 0 | 0 | 1,375,682 | |||||||
Common stock that may be sold (up to) | $ | $ 75,000,000 | |||||||||
Common stock, par value (in Dollars per share) | $ / shares | $ 0.01 | |||||||||
Share price (in Dollars per share) | $ / shares | $ 8.04 | |||||||||
Proceeds from issuance of common stock | $ | $ 10,800,000 | |||||||||
Common stock reserved for issuance | $ | $ 52,900,000 | $ 52,900,000 | ||||||||
Prior Equity Distribution Agreement | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued | 1,326,676 | 2,153,989 | ||||||||
Common stock that may be sold (up to) | $ | $ 25,000,000 | |||||||||
Share price (in Dollars per share) | $ / shares | $ 7.63 | $ 7.89 | ||||||||
Proceeds from issuance of common stock | $ | $ 10,300,000 | $ 16,100,000 | ||||||||
Series B Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Preferred stock, shares authorized (in shares) | 6,000,000 | 6,000,000 | 6,000,000 | |||||||
Preferred stock, par value (in Dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||
Preferred stock, shares issued (in shares) | 3,000,000 | 3,000,000 | 3,000,000 | |||||||
Preferred stock, shares outstanding (in shares) | 3,000,000 | 3,000,000 | 3,000,000 | |||||||
Shares issued | 3,000,000 | |||||||||
Preferred stock, cumulative redeemable dividend rate | 7.75% | 7.75% | 7.75% | |||||||
Preferred stock, liquidation preference per share (in Dollars per share) | $ / shares | $ 25 | $ 25 | $ 25 | $ 25 | ||||||
Preferred stock issuance, net | $ | $ 72,400,000 | |||||||||
Redemption term | 120 days | |||||||||
Redemption price (in Dollars per share) | $ / shares | $ 25 | $ 25 | ||||||||
Series C Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Preferred stock, shares authorized (in shares) | 4,140,000 | 4,140,000 | 4,140,000 | |||||||
Preferred stock, par value (in Dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||
Preferred stock, shares issued (in shares) | 3,600,000 | 3,600,000 | 3,600,000 | 3,600,000 | ||||||
Preferred stock, shares outstanding (in shares) | 3,600,000 | 3,600,000 | 3,600,000 | |||||||
Preferred stock, cumulative redeemable dividend rate | 7.875% | 7.875% | 7.875% | |||||||
Preferred stock, liquidation preference per share (in Dollars per share) | $ / shares | $ 25 | $ 25 | $ 25 | $ 25 | ||||||
Preferred stock issuance, net | $ | $ 86,900,000 | |||||||||
Series B and C Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Number of quarters with no dividends that results in voting rights | quarter | 6 | 6 | ||||||||
Number of elected directors pending preferred stock voting rights | director | 2 | 2 | ||||||||
Stockholders required for term changes, percentage | 66.67% | 66.67% |
Stockholders' Equity - Cash Div
Stockholders' Equity - Cash Dividends Declared - Preferred Stock (Details) - $ / shares | Jul. 15, 2016 | Apr. 15, 2016 | Jan. 15, 2016 | Oct. 15, 2015 | Jul. 15, 2015 | [1] | Apr. 15, 2015 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | |
Dividends Payable [Line Items] | ||||||||||||||
Declaration Date | Jun. 16, 2016 | Mar. 18, 2016 | Dec. 16, 2015 | Sep. 18, 2015 | Jun. 18, 2015 | Mar. 18, 2015 | ||||||||
Record Date | Jun. 27, 2016 | Mar. 28, 2016 | Dec. 28, 2015 | Sep. 28, 2015 | Jun. 29, 2015 | Mar. 30, 2015 | ||||||||
Payment Date | Jul. 25, 2016 | Apr. 25, 2016 | Jan. 25, 2016 | Oct. 26, 2015 | Jul. 27, 2015 | Apr. 27, 2015 | ||||||||
Series B Preferred Stock | ||||||||||||||
Dividends Payable [Line Items] | ||||||||||||||
Declaration Date | Jun. 16, 2016 | Mar. 18, 2016 | Dec. 16, 2015 | Sep. 18, 2015 | Jun. 18, 2015 | [1] | Mar. 18, 2015 | |||||||
Record Date | Jul. 1, 2016 | Apr. 1, 2016 | Jan. 1, 2016 | Oct. 1, 2015 | Jul. 1, 2015 | [1] | Apr. 1, 2015 | |||||||
Payment Date | Jul. 15, 2016 | Apr. 15, 2016 | Jan. 15, 2016 | Oct. 15, 2015 | Jul. 15, 2015 | [1] | Apr. 15, 2015 | |||||||
Cash Dividend Per Share | $ 0.484375 | $ 0.484375 | $ 0.484375 | $ 0.484375 | $ 0.484375 | |||||||||
Series C Preferred Stock | ||||||||||||||
Dividends Payable [Line Items] | ||||||||||||||
Declaration Date | Jun. 16, 2016 | Mar. 18, 2016 | Dec. 16, 2015 | Sep. 18, 2015 | Jun. 18, 2015 | [1] | ||||||||
Record Date | Jul. 1, 2016 | Apr. 1, 2016 | Jan. 1, 2016 | Oct. 1, 2015 | Jul. 1, 2015 | [1] | ||||||||
Payment Date | Jul. 15, 2016 | Apr. 15, 2016 | Jan. 15, 2016 | Oct. 15, 2015 | Jul. 15, 2015 | [1] | ||||||||
Cash Dividend Per Share | $ 0.4921875 | $ 0.4921875 | $ 0.4921875 | $ 0.45391000 | ||||||||||
Subsequent Event | Series B Preferred Stock | ||||||||||||||
Dividends Payable [Line Items] | ||||||||||||||
Cash Dividend Per Share | $ 0.484375 | |||||||||||||
Subsequent Event | Series C Preferred Stock | ||||||||||||||
Dividends Payable [Line Items] | ||||||||||||||
Cash Dividend Per Share | $ 0.4921875 | |||||||||||||
[1] | Cash dividend for the partial quarterly period that began on April 22, 2015 and ended on July 14, 2015. |
Stockholders' Equity - Cash D94
Stockholders' Equity - Cash Dividends Declared - Common Stock (Details) - $ / shares | Jul. 25, 2016 | Apr. 25, 2016 | Jan. 25, 2016 | Oct. 26, 2015 | Jul. 27, 2015 | Apr. 27, 2015 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 |
Stockholders' Equity Note [Abstract] | ||||||||||||
Declaration Date | Jun. 16, 2016 | Mar. 18, 2016 | Dec. 16, 2015 | Sep. 18, 2015 | Jun. 18, 2015 | Mar. 18, 2015 | ||||||
Record Date | Jun. 27, 2016 | Mar. 28, 2016 | Dec. 28, 2015 | Sep. 28, 2015 | Jun. 29, 2015 | Mar. 30, 2015 | ||||||
Payment Date | Jul. 25, 2016 | Apr. 25, 2016 | Jan. 25, 2016 | Oct. 26, 2015 | Jul. 27, 2015 | Apr. 27, 2015 | ||||||
Cash Dividend Per Share | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.24 | $ 0.27 | $ 0.27 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Earnings Per Share [Abstract] | ||
Dilutive instruments (in shares) | 0 | 0 |
Earnings Per Share - Basic and
Earnings Per Share - Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Numerator: | ||||
Net income attributable to Company's common stockholders– Basic | $ 11,210 | $ 21,544 | $ 24,936 | $ 43,634 |
Net income attributable to Company's common stockholders– Dilutive | $ 11,210 | $ 21,544 | $ 24,936 | $ 43,634 |
Denominator: | ||||
Weighted average basic and diluted shares outstanding (in shares) | 109,489 | 109 | 109,445 | 107,380 |
EPS: | ||||
Basic EPS (in Dollars per share) | $ 0.10 | $ 0.20 | $ 0.23 | $ 0.41 |
Dilutive EPS (in Dollars per share) | $ 0.10 | $ 0.20 | $ 0.23 | $ 0.41 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
May 31, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Non-vested shares | 319,058 | 280,457 | 319,058 | 280,457 | 280,457 | 162,171 | |
Shares granted | 160,453 | 185,650 | |||||
Performance Share Awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 3 years | ||||||
2010 Stock Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Maximum number of shares that may be issued | 1,190,000 | 1,190,000 | |||||
Shares available for grant | 331,077 | 331,077 | 551,609 | ||||
2010 Stock Incentive Plan | Director | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares issued, aggregate | 207,014 | 207,014 | 146,935 | ||||
2010 Stock Incentive Plan | Employee Stock Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares issued, aggregate | 562,280 | 562,280 | 401,827 | ||||
2010 Stock Incentive Plan | Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Non-vested shares | 319,058 | 319,058 | 280,457 | ||||
Share-based compensation expense | $ 200,000 | $ 200,000 | $ 500,000 | $ 400,000 | |||
Forfeitures (in shares) | 0 | 0 | |||||
Unrecognized compensation cost | 1,700,000 | $ 1,600,000 | $ 1,700,000 | $ 1,600,000 | |||
Unrecognized compensation cost, period for recognition | 2 years 45 days | ||||||
Fair value of vested shares | $ 600,000 | $ 500,000 | |||||
Requisite service period | 3 years | ||||||
2010 Stock Incentive Plan | Performance Share Awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expense | 31,700 | $ 63,400 | |||||
Unrecognized compensation cost | $ 200,000 | $ 200,000 | |||||
2010 Stock Incentive Plan | Performance Share Awards | Board of Directors Chairman | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | 89,629 | ||||||
Fair value of shares granted | $ 400,000 | ||||||
Percentage of target PSA's granted eligible for receipt, minimum | 0.00% | ||||||
Percentage of target PSA's granted eligible for receipt, maximum | 200.00% | ||||||
Award vesting period | 3 years | ||||||
Fair value, expected term | 3 years | ||||||
Fair value, expected term for volatility rate | 3 years | ||||||
Fair value, expected term for risk free interest rate | 3 years | ||||||
Fair value, expected term for dividend rate | 3 years | ||||||
2010 Stock Incentive Plan | Performance Share Awards | Board of Directors Chairman | If TSR is Less Than 33% | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 0.00% | ||||||
2010 Stock Incentive Plan | Performance Share Awards | Board of Directors Chairman | If TSR is Greater Than or Equal to 33% | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 100.00% | ||||||
2010 Stock Incentive Plan | Performance Share Awards | Board of Directors Chairman | If TSR is Greater Than or Equal to 33% and TSR Is InTop Quartile of Identified Peer Group | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 200.00% | ||||||
2010 Stock Incentive Plan | Performance Share Awards | Board of Directors Chairman | If TSR Is Greater Than or Equal to 33% and TSR Is InBottom Quartile of Identified Peer Group | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 50.00% |
Stock Based Compensation - Non-
Stock Based Compensation - Non-vested Restricted Stock (Details) - Restricted Stock - $ / shares | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Non-vested shares at January 1 (in shares) | 280,457 | 162,171 | |
Granted (in shares) | 160,453 | 185,650 | |
Vested (in shares) | (121,852) | (67,364) | |
Non-vested shares as of June 30 (in shares) | 319,058 | 280,457 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Non-vested shares at January 1 (in Dollars per share) | [1] | $ 7.63 | $ 7.26 |
Granted (in Dollars per share) | [1] | 5.11 | 7.79 |
Vested (in Dollars per share) | [1] | 7.54 | 7.18 |
Non-vested shares as of June 30 (in Dollars per share) | [1] | $ 6.40 | $ 7.63 |
[1] | The grant date fair value of restricted stock awards is based on the closing market price of the Company’s common stock at the grant date. |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Operating Loss Carryforwards [Line Items] | ||||
Net operating losses | $ (14,435) | $ (24,631) | $ (31,386) | $ (48,174) |
Earliest Tax Year | ||||
Operating Loss Carryforwards [Line Items] | ||||
Open tax year | 2,012 | |||
Latest Tax Year | ||||
Operating Loss Carryforwards [Line Items] | ||||
Open tax year | 2,015 | |||
Taxable REIT Subsidiaries | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating losses | $ 4,900 | |||
Capital losses | $ 1,600 |
Income Taxes - Income Tax Provi
Income Taxes - Income Tax Provision (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||||
Current income tax expense | $ 2,183 | $ 955 | $ 2,255 | $ 1,989 |
Deferred income tax expense (benefit) | 183 | 223 | 302 | (567) |
Total provision | $ 2,366 | $ 1,178 | $ 2,557 | $ 1,423 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Asset (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | ||
Deferred tax assets | ||||
Net operating loss carryforward | $ 2,268 | $ 2,083 | ||
Net capital loss carryforward | 754 | 2,029 | ||
GAAP/Tax basis differences | 2,874 | 3,043 | ||
Total deferred tax assets | 5,896 | [1] | 7,155 | |
Deferred tax liabilities | ||||
Deferred tax liabilities | [2] | 1,702 | 192 | |
Valuation allowance | [1] | (4,170) | (6,457) | |
Total net deferred tax asset | $ 24 | $ 506 | ||
[1] | Included in receivables and other assets in the accompanying condensed consolidated balance sheets. | |||
[2] | Included in accrued expenses and other liabilities in the accompanying condensed consolidated balance sheets. |
Business Combinations (Details)
Business Combinations (Details) - USD ($) | May 16, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | May 15, 2016 | Mar. 31, 2016 | |
Business Acquisition [Line Items] | ||||||
Capital | $ 371,500,000 | |||||
Payments to beneficial owner to acquire business | $ 16,300,000 | |||||
Gain on bargain purchase on businesses acquired | $ (65,000) | $ 0 | ||||
Gain on remeasurement of existing membership interest in businesses acquired | $ (5,045,000) | $ 0 | ||||
RiverBanc, RBMI, and RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Subsidiary cumulative percentage ownership after all transactions | 100.00% | |||||
Cash consideration paid for acquisition | [1] | $ 29,053,000 | ||||
Contingent Consideration | 3,800,000 | |||||
Fair value of previously held membership interests | 20,608,000 | |||||
Total consideration transferred | 53,461,000 | |||||
Gain on remeasurement of existing membership interest in businesses acquired | (5,000,000) | |||||
RiverBanc | ||||||
Business Acquisition [Line Items] | ||||||
Ownership percentage by noncontrolling owners prior to acquisition | $ 0.594 | |||||
RiverBanc | RiverBanc, RBMI, and RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Equity Interest in acquiree, percentage | 20.00% | |||||
RBMI | ||||||
Business Acquisition [Line Items] | ||||||
Ownership percentage by noncontrolling owners prior to acquisition | $ 0.0547 | |||||
RBMI | RiverBanc, RBMI, and RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Equity Interest in acquiree, percentage | 67.19% | |||||
RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Ownership percentage by noncontrolling owners prior to acquisition | $ 0.0625 | |||||
RBDHC | RiverBanc, RBMI, and RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Equity Interest in acquiree, percentage | 62.50% | |||||
RBMI, RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Gain on bargain purchase on businesses acquired | [2] | (65,000) | ||||
Other Income | RiverBanc, RBMI, and RBDHC | ||||||
Business Acquisition [Line Items] | ||||||
Gain on remeasurement of existing membership interest in businesses acquired | $ (5,000,000) | |||||
[1] | (1) Includes $16.3 million paid to Donlon Family LLC. | |||||
[2] | Gain on bargain purchase recognized in the acquisitions of RBMI and RBDHC. |
Business Combinations Contingen
Business Combinations Contingent Consideration (Details) - RiverBanc, RBMI, and RBDHC $ in Millions | May 16, 2016USD ($) |
Cash Holdback | |
Business Acquisition, Contingent Consideration [Line Items] | |
Contingent consideration | $ 3 |
Reimbursement to previous beneficial owner for purchase of company shares | $ 3 |
Contingent consideration term | 90 days |
Severance Holdback | |
Business Acquisition, Contingent Consideration [Line Items] | |
Contingent consideration | $ 0.8 |
Contingent consideration term | 60 days |
Business Combinations Schedule
Business Combinations Schedule Of Recognized Identified Assets Acquired And Liabilities Assumed (Details) - USD ($) $ in Thousands | May 16, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Business Acquisition [Line Items] | |||||
Cash | $ 4,325 | ||||
Investment in unconsolidated entities | 52,176 | ||||
Mezzanine loan and preferred equity investments | 23,638 | ||||
Real estate under development | [1] | 14,922 | |||
Receivables and other assets | 911 | ||||
Intangible assets | [1] | 3,910 | |||
Total identifiable assets acquired | 99,882 | ||||
Preferred debt | [2] | 56,697 | |||
Construction loan payable | [3] | 8,499 | |||
Accrued expenses and other liabilities | 2,864 | ||||
Total liabilities assumed | 11,363 | ||||
Net identifiable assets acquired | 31,822 | ||||
Goodwill | $ 24,782 | $ 0 | |||
Gain on bargain purchase on businesses acquired | (65) | $ 0 | |||
Noncontrolling Interest, Increase from Business Combination | (3,078) | ||||
Gain on remeasurement of existing membership interest in businesses acquired | $ (5,045) | $ 0 | |||
Net assets acquired | 53,461 | ||||
Intercompany transaction eliminated | 40,400 | ||||
Payables to third parties | 16,300 | ||||
RiverBanc, RBMI, and RBDHC | |||||
Business Acquisition [Line Items] | |||||
Noncontrolling Interest, Increase from Business Combination | [4] | (3,078) | |||
Gain on remeasurement of existing membership interest in businesses acquired | (5,000) | ||||
Fair value of previously held membership interests | 20,608 | ||||
KRVI | |||||
Business Acquisition [Line Items] | |||||
Noncontrolling Interest, Increase from Business Combination | (3,100) | ||||
RiverBanc | |||||
Business Acquisition [Line Items] | |||||
Intangible assets | 3,900 | ||||
Goodwill | [5] | 24,782 | |||
RBMI, RBDHC | |||||
Business Acquisition [Line Items] | |||||
Gain on bargain purchase on businesses acquired | [6] | $ (65) | |||
Minimum | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 1 year | ||||
Maximum | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 15 years | ||||
[1] | (1) Included in receivables and other assets on the condensed consolidated balance sheets. | ||||
[2] | Includes $40.4 million of preferred equity owned by the Company that is eliminated on the condensed consolidated balance sheets. Remaining $16.3 million of preferred equity owned by third parties was redeemed in the period ended June 30, 2016. | ||||
[3] | (2) Construction loan payable to the Company is eliminated on the condensed consolidated balance sheets. | ||||
[4] | HC.(6) Represents third-party ownership of KRVI membership interests (see Note 7). The Company consolidates its investment in KRVI. The third-party ownership in KRVI is represented in the condensed consolidated financial statements and the pro forma net income attributable to the Company's common stockholders as non-controlling interests. The fair value of the non-controlling interests in KRVI is estimated to be $3.1 million. The fair value of the non-controlling interests in KRVI, a private company, was estimated using assumptions for the timing and amount of expected future cash flow for income and realization events for the underlying real estate. | ||||
[5] | Goodwill recognized in the acquisition of RiverBanc. | ||||
[6] | Gain on bargain purchase recognized in the acquisitions of RBMI and RBDHC. |
Business Combinations Proforma
Business Combinations Proforma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | May 16, 2016 | Jun. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | |
Business Acquisition [Line Items] | |||||
Gain on remeasurement of existing membership interest in businesses acquired | $ (5,045) | $ 0 | |||
Gain on bargain purchase on businesses acquired | (65) | 0 | |||
Income tax expense on gains resulting from business combinations | $ 2,100 | ||||
Pro forma revenue | 175,923 | 207,011 | |||
Pro forma net income (loss) | $ 21,897 | $ 49,269 | |||
Pro forma earnings per share, basic | $ 0.20 | $ 0.46 | |||
Pro forma earnings per share, diluted | $ 0.20 | $ 0.46 | |||
Revenue of acquiree since acquisition date | $ 1,000 | ||||
RiverBanc, RBMI, and RBDHC | |||||
Business Acquisition [Line Items] | |||||
Gain on remeasurement of existing membership interest in businesses acquired | (5,000) | ||||
RBMI, RBDHC | |||||
Business Acquisition [Line Items] | |||||
Gain on bargain purchase on businesses acquired | [1] | $ (65) | |||
[1] | Gain on bargain purchase recognized in the acquisitions of RBMI and RBDHC. |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||||
Investments in affiliates | $ 73,839,000 | $ 73,839,000 | $ 87,662,000 | ||
Preferred Stock | RB Multifamily Investors LLC | |||||
Related Party Transaction [Line Items] | |||||
Equity method investment | $ 41,500,000 | ||||
Management Agreement With River Banc LLC | |||||
Related Party Transaction [Line Items] | |||||
Management agreement, renewal term | 1 year | ||||
Ownership Interest | 20.00% | 20.00% | 20.00% | ||
Revenue from related parties | $ 33,500 | $ 100,000 | $ 100,000 | $ 800,000 | |
Expenses from transactions with related parties | $ 600,000 | $ 900,000 | $ 1,800,000 | $ 4,800,000 | |
Fees payable to related parties | $ 1,700,000 | ||||
RB Multifamily Investors LLC | |||||
Related Party Transaction [Line Items] | |||||
Noncontrolling interest, ownership by parent, percentage | 67.00% |